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PREFACE
PREFACE
1.
This Report has been prepared for submission to the Governor under
Article 151(2) of the Constitution.
2.
Chapter I of this Report contains audit observations on matters arising
from examination of accounts and finances of Zilla Panchayats and
Taluk Panchayats.
3.
The other chapter deals with the findings of audit on financial
transactions of Zilla Panchayats and Taluk Panchayats.
4.
The Reports containing the observations arising out of audit of
(i) Statutory Corporations, Boards and Government Companies;
(ii) Revenue Receipts; and (iii) Civil Departments are presented
separately.
5.
The cases mentioned in the Report are among those which came to
notice in the course of test audit of accounts during the year 2007-08 as
well as those which had come to notice in earlier years, but could not
be dealt with in previous Reports; matters relating to the periods
subsequent to 2007-08 have also been included, wherever necessary.
v
OVERVIEW
The Report contains two chapters. The first chapter contains observations of
Audit on the accounts and finances of the Zilla Panchayats and Taluk
Panchayats and the other chapter contains three performance audit reviews
and 13 paragraphs based on the audit of financial transactions of the Zilla
Panchayats and Taluk Panchayats. A synopsis of the findings contained in the
performance reviews and paragraphs is presented in this overview.
1.
A
OVERVIEW OF THE ACCOU
TS A
D FI
A
CES
OF ZILLA PA
CHAYATS A
D TALUK PA
CHAYATS
During 2004-07, the allocation to Panchayat Raj Institutions formed 14 to 16
per cent of the total budget of the State.
(Paragraph 1.3.1)
Despite being pointed out in earlier Audit Reports, delays persisted in
forwarding the annual accounts of the Zilla Panchayats to the Principal
Accountant General for audit.
(Paragraph 1.4.1)
While total receipts and expenditure in Panchayat Raj Institutions increased
steadily during 2004-07, the capital expenditure declined sharply during
2006-07 compared to 2005-06.
(Paragraphs 1.5.1 and 1.5.2)
Abnormal delays were noticed in release of Twelfth Finance Commission
grants to Panchayat Raj Institutions. Interest payment was irregularly
charged to ‘Plan’ Head of Account denying funds for envisaged rural
developmental activities.
(Paragraph 1.6.1)
The devolution of funds and functions to Panchayat Raj Institutions was not as
envisaged in the Constitution.
(Paragraphs 1.7.1 and 1.7.2)
Contrary to the spirit of devolution of funds to Panchayati Raj Institutions,
funds for procurement and supply of medicine for health centers/institutions
were allotted to Government Medical Stores.
(Paragraph 1.7.2)
Drawing and Disbursing Officers of 14 Zilla Panchayats failed to submit the
detailed accounts for Rs.4.64 crore drawn on Abstract Contingent bills.
(Paragraph 1.8.3)
ix
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
In 26 Zilla Panchayats, as many as 397 cases of misappropriation/defalcation
involving Rs.24.47 crore were pending at various stages.
(Paragraph 1.10)
2
Suvarna Gramodaya Yojana
To develop vibrant village communities by adopting an intensive and
integrated approach to rural development, the State Government launched the
Suvarna Gramodaya Yojana in October 2006. The implementation of the
Scheme suffered due to laxity of the State Government in preparatory
procedures and inadequacies in convergence with other ongoing schemes.
There was delay in approval of action plans, diversion of funds, nonprioritisation of developmental works, absence of monitoring mechanism, etc.
There was no perspective plan for development of villages and the selection of
villages was made by the State Government without specific criteria.
(Paragraphs 2.1.6.1 and 2.1.6.5)
The =on-Governmental Organisations prepared the development plans
without the approval of Grama Sabhas and the annual action plans were
belatedly approved.
(Paragraphs 2.1.6.2 and 2.1.6.3)
As against the envisaged allocation of Rs.1,000.60 crore for development of
1,200 villages during 2006-07, State government released only Rs.458.84
crore as of March 2008. Further, the funds were released at the fag end of the
year and were parked in bank accounts in order to avoid lapse of grants.
Inconsistencies were also noticed in release of grants.
(Paragraphs 2.1.7.1 and 2.1.7.2)
The allocations under sector programmes by the line departments were
meagre.
(Paragraph 2.1.7.4)
The approved works were not completed due to delays in entrustment of works
to the executing agencies. The developmental works were also not prioritised.
(Paragraphs 2.1.8.1 and 2.1.8.2)
Mechanism for monitoring and evaluation of the scheme was absent.
(Paragraph 2.1.10)
x
Overview
3
Rural Road Works
Connectivity to rural habitation is a key factor in promoting access to
economic and social services. This acts as a basic ingredient in effective
implementation of poverty alleviation programmes in rural areas. A review of
implementation of schemes for rural road works revealed that the schemes
suffered due to defective annual action plans, execution of unprioritised
works, sub-standard works, etc.
District Rural Road Plans were not updated periodically and priority list for
development of rural roads was not prepared.
(Paragraph 2.2.7.1)
Annual Action Plans were deficient and 612 road works included in Annual
Action Plans were not traced to District Rural Road Plans.
(Paragraph 2.2.7.2)
Funds amounting to Rs.7.15 crore was diverted from Mukya Mantri
Grameena Rasthe Abhivridhi Yojana for payment of daily wage employees.
(Paragraph 2.2.8.2)
Execution of road works in disregard of specifications of Rural Roads Manual
rendered 86 works costing Rs.98.80 lakh sub-standard.
(Paragraph 2.2.9.7)
Quality control test and monitoring of rural road works were inadequate.
(Paragraphs 2.2.12.1 and 2.2.12.2)
4
Performance appraisal on functioning of selected departments of
Zilla Panchayat, Bellary
Zilla Panchayat, Bellary was implementing various developmental activities
through Taluk/Grama Panchayats, line departments and engineering
divisions. A performance appraisal on functioning of selected departments of
Zilla Panchayat, Bellary during 2003-08 revealed, inter alia, that there were
instances of improper planning and budgeting, internal control mechanism
failures in financial management, non-achievement of intended objectives of
the developmental schemes coupled with unfruitful, wasteful expenditure, etc.
The functioning of District Planning Committee was ineffective. In the
absence of defined needs of grass root level, the Annual District Development
Plans prepared during 2003-08 was not in conformity with the provisions of
Karnataka Panchayat Raj Act.
(Paragraph 2.3.6.1)
xi
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
While irregular drawal of Rs.34.58 crore and depositing outside Government
account was observed, central assistance of Rs.6.15 crore was lost due to
tardy implementation of Desert Development Programme.
(Paragraphs 2.3.7.3 and 2.3.7.4)
The objective of providing education to all the children in the age group of 614 years through implementation of various programmes was not achieved
due to shortfall in enrolment, increasing trend in drop-out rate, large number
of vacancies in the posts of teachers, lack of proper infrastructure, etc.
(Paragraphs 2.3.8.2 to 2.3.8.4)
The establishment of Primary/Community Health Centres was not in
conformity with the norms. The rural population of the district was denied
health care facilities due to large number of vacant posts of doctors and
supportive staff, non-provision of basic infrastructure, shortfall in ante-natal
check-ups/institutional deliveries, etc.
(Paragraphs 2.3.9.1 and 2.3.9.2)
During 2003-08, though an expenditure of Rs.4.29 crore was incurred on the
establishment charges of Social Forestry Division, the area brought under the
green cover was only 37 hectares. Plantation/seedlings raised at a cost of
Rs.57.40 lakh had not been maintained.
(Paragraphs 2.3.10.1 and 2.3.10.2)
Improper planning by Youth Services and Sports Department resulted in
wasteful expenditure of Rs.43 lakh on laying of cinder track. There was
abnormal delay in completion of stadia on which an investment of Rs.45.04
lakh was made.
(Paragraphs 2.3.11.1 and 2.3.11.3)
Failure of the Zilla Panchayat/Panchayat Raj Engineering Division, Bellary
in obtaining prior permission from the Daroji Grama Panchayat for drawing
water from Daroji reservoir resulted in non-execution of a water supply
scheme under the concept of private-public participation.
(Paragraph 2.3.13.3)
The implementation of water supply schemes was not planned properly.
Defective estimates and improper monitoring resulted in extra expenditure of
Rs.19.24 lakh.
(Paragraph 2.3.13.4)
There was delay in completion of water supply works rendering the
expenditure unfruitful. Instances of execution of civil works in private lands
and delay in completion of road works due to paucity of funds were noticed.
(Paragraphs 2.3.14.1 to 2.3.14.3)
xii
Overview
6
Draft Paragraphs
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chikkodi, to prioritise water supply work components during execution
resulted in non-commissioning of a water supply scheme for over four years
rendering an expenditure of Rs.2.37 crore unfruitful.
(Paragraph 2.5)
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chikmagalur, to invoke contractual clause resulted in cost escalation of
Rs.14.95 lakh. Besides, the objective of providing connectivity to villages was
delayed by more than five years.
(Paragraph 2.6)
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chamarajanagar to follow prescribed tendering procedure led to extra
liability of Rs.43.81 lakh besides accepting fake bank deposit receipts for
Rs.3.60 lakh.
(Paragraph 2.8)
Failure of Zilla Panchayat, Bellary in assessing the condition of the raw water
raising main prior to entrustment of work coupled with delays by Executive
Engineer/Chief Engineer in obtaining approval from State Government and
entrustment of work after re-tendering led to unfruitful expenditure of
Rs.92.80 lakh besides cost escalation of Rs.4.95 crore.
(Paragraph 2.9)
Failure of Executive Engineer, Panchayat Raj Engineering Division, Koppal
in preparing estimate for construction of a hostel building considering the site
condition led to wasteful expenditure of Rs.19.98 lakh.
(Paragraph 2.13)
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chamarajanagar to complete the work components of a lift irrigation scheme
rendered expenditure of Rs.23.08 lakh unfruitful besides denial of irrigation
facilities to the rehabilitated tribal population.
(Paragraph 2.14)
xiii
OVERVIEW
The Report contains two chapters. The first chapter contains observations of
Audit on the accounts and finances of the Zilla Panchayats and Taluk
Panchayats and the other chapter contains three performance audit reviews
and 13 paragraphs based on the audit of financial transactions of the Zilla
Panchayats and Taluk Panchayats. A synopsis of the findings contained in the
performance reviews and paragraphs is presented in this overview.
1.
A
OVERVIEW OF THE ACCOU
TS A
D FI
A
CES
OF ZILLA PA
CHAYATS A
D TALUK PA
CHAYATS
During 2004-07, the allocation to Panchayat Raj Institutions formed 14 to 16
per cent of the total budget of the State.
(Paragraph 1.3.1)
Despite being pointed out in earlier Audit Reports, delays persisted in
forwarding the annual accounts of the Zilla Panchayats to the Principal
Accountant General for audit.
(Paragraph 1.4.1)
While total receipts and expenditure in Panchayat Raj Institutions increased
steadily during 2004-07, the capital expenditure declined sharply during
2006-07 compared to 2005-06.
(Paragraphs 1.5.1 and 1.5.2)
Abnormal delays were noticed in release of Twelfth Finance Commission
grants to Panchayat Raj Institutions. Interest payment was irregularly
charged to ‘Plan’ Head of Account denying funds for envisaged rural
developmental activities.
(Paragraph 1.6.1)
The devolution of funds and functions to Panchayat Raj Institutions was not as
envisaged in the Constitution.
(Paragraphs 1.7.1 and 1.7.2)
Contrary to the spirit of devolution of funds to Panchayati Raj Institutions,
funds for procurement and supply of medicine for health centers/institutions
were allotted to Government Medical Stores.
(Paragraph 1.7.2)
Drawing and Disbursing Officers of 14 Zilla Panchayats failed to submit the
detailed accounts for Rs.4.64 crore drawn on Abstract Contingent bills.
(Paragraph 1.8.3)
ix
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
In 26 Zilla Panchayats, as many as 397 cases of misappropriation/defalcation
involving Rs.24.47 crore were pending at various stages.
(Paragraph 1.10)
2
Suvarna Gramodaya Yojana
To develop vibrant village communities by adopting an intensive and
integrated approach to rural development, the State Government launched the
Suvarna Gramodaya Yojana in October 2006. The implementation of the
Scheme suffered due to laxity of the State Government in preparatory
procedures and inadequacies in convergence with other ongoing schemes.
There was delay in approval of action plans, diversion of funds, nonprioritisation of developmental works, absence of monitoring mechanism, etc.
There was no perspective plan for development of villages and the selection of
villages was made by the State Government without specific criteria.
(Paragraphs 2.1.6.1 and 2.1.6.5)
The =on-Governmental Organisations prepared the development plans
without the approval of Grama Sabhas and the annual action plans were
belatedly approved.
(Paragraphs 2.1.6.2 and 2.1.6.3)
As against the envisaged allocation of Rs.1,000.60 crore for development of
1,200 villages during 2006-07, State government released only Rs.458.84
crore as of March 2008. Further, the funds were released at the fag end of the
year and were parked in bank accounts in order to avoid lapse of grants.
Inconsistencies were also noticed in release of grants.
(Paragraphs 2.1.7.1 and 2.1.7.2)
The allocations under sector programmes by the line departments were
meagre.
(Paragraph 2.1.7.4)
The approved works were not completed due to delays in entrustment of works
to the executing agencies. The developmental works were also not prioritised.
(Paragraphs 2.1.8.1 and 2.1.8.2)
Mechanism for monitoring and evaluation of the scheme was absent.
(Paragraph 2.1.10)
x
Overview
3
Rural Road Works
Connectivity to rural habitation is a key factor in promoting access to
economic and social services. This acts as a basic ingredient in effective
implementation of poverty alleviation programmes in rural areas. A review of
implementation of schemes for rural road works revealed that the schemes
suffered due to defective annual action plans, execution of unprioritised
works, sub-standard works, etc.
District Rural Road Plans were not updated periodically and priority list for
development of rural roads was not prepared.
(Paragraph 2.2.7.1)
Annual Action Plans were deficient and 612 road works included in Annual
Action Plans were not traced to District Rural Road Plans.
(Paragraph 2.2.7.2)
Funds amounting to Rs.7.15 crore was diverted from Mukya Mantri
Grameena Rasthe Abhivridhi Yojana for payment of daily wage employees.
(Paragraph 2.2.8.2)
Execution of road works in disregard of specifications of Rural Roads Manual
rendered 86 works costing Rs.98.80 lakh sub-standard.
(Paragraph 2.2.9.7)
Quality control test and monitoring of rural road works were inadequate.
(Paragraphs 2.2.12.1 and 2.2.12.2)
4
Performance appraisal on functioning of selected departments of
Zilla Panchayat, Bellary
Zilla Panchayat, Bellary was implementing various developmental activities
through Taluk/Grama Panchayats, line departments and engineering
divisions. A performance appraisal on functioning of selected departments of
Zilla Panchayat, Bellary during 2003-08 revealed, inter alia, that there were
instances of improper planning and budgeting, internal control mechanism
failures in financial management, non-achievement of intended objectives of
the developmental schemes coupled with unfruitful, wasteful expenditure, etc.
The functioning of District Planning Committee was ineffective. In the
absence of defined needs of grass root level, the Annual District Development
Plans prepared during 2003-08 was not in conformity with the provisions of
Karnataka Panchayat Raj Act.
(Paragraph 2.3.6.1)
xi
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
While irregular drawal of Rs.34.58 crore and depositing outside Government
account was observed, central assistance of Rs.6.15 crore was lost due to
tardy implementation of Desert Development Programme.
(Paragraphs 2.3.7.3 and 2.3.7.4)
The objective of providing education to all the children in the age group of 614 years through implementation of various programmes was not achieved
due to shortfall in enrolment, increasing trend in drop-out rate, large number
of vacancies in the posts of teachers, lack of proper infrastructure, etc.
(Paragraphs 2.3.8.2 to 2.3.8.4)
The establishment of Primary/Community Health Centres was not in
conformity with the norms. The rural population of the district was denied
health care facilities due to large number of vacant posts of doctors and
supportive staff, non-provision of basic infrastructure, shortfall in ante-natal
check-ups/institutional deliveries, etc.
(Paragraphs 2.3.9.1 and 2.3.9.2)
During 2003-08, though an expenditure of Rs.4.29 crore was incurred on the
establishment charges of Social Forestry Division, the area brought under the
green cover was only 37 hectares. Plantation/seedlings raised at a cost of
Rs.57.40 lakh had not been maintained.
(Paragraphs 2.3.10.1 and 2.3.10.2)
Improper planning by Youth Services and Sports Department resulted in
wasteful expenditure of Rs.43 lakh on laying of cinder track. There was
abnormal delay in completion of stadia on which an investment of Rs.45.04
lakh was made.
(Paragraphs 2.3.11.1 and 2.3.11.3)
Failure of the Zilla Panchayat/Panchayat Raj Engineering Division, Bellary
in obtaining prior permission from the Daroji Grama Panchayat for drawing
water from Daroji reservoir resulted in non-execution of a water supply
scheme under the concept of private-public participation.
(Paragraph 2.3.13.3)
The implementation of water supply schemes was not planned properly.
Defective estimates and improper monitoring resulted in extra expenditure of
Rs.19.24 lakh.
(Paragraph 2.3.13.4)
There was delay in completion of water supply works rendering the
expenditure unfruitful. Instances of execution of civil works in private lands
and delay in completion of road works due to paucity of funds were noticed.
(Paragraphs 2.3.14.1 to 2.3.14.3)
xii
Overview
6
Draft Paragraphs
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chikkodi, to prioritise water supply work components during execution
resulted in non-commissioning of a water supply scheme for over four years
rendering an expenditure of Rs.2.37 crore unfruitful.
(Paragraph 2.5)
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chikmagalur, to invoke contractual clause resulted in cost escalation of
Rs.14.95 lakh. Besides, the objective of providing connectivity to villages was
delayed by more than five years.
(Paragraph 2.6)
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chamarajanagar to follow prescribed tendering procedure led to extra
liability of Rs.43.81 lakh besides accepting fake bank deposit receipts for
Rs.3.60 lakh.
(Paragraph 2.8)
Failure of Zilla Panchayat, Bellary in assessing the condition of the raw water
raising main prior to entrustment of work coupled with delays by Executive
Engineer/Chief Engineer in obtaining approval from State Government and
entrustment of work after re-tendering led to unfruitful expenditure of
Rs.92.80 lakh besides cost escalation of Rs.4.95 crore.
(Paragraph 2.9)
Failure of Executive Engineer, Panchayat Raj Engineering Division, Koppal
in preparing estimate for construction of a hostel building considering the site
condition led to wasteful expenditure of Rs.19.98 lakh.
(Paragraph 2.13)
Failure of Executive Engineer, Panchayat Raj Engineering Division,
Chamarajanagar to complete the work components of a lift irrigation scheme
rendered expenditure of Rs.23.08 lakh unfruitful besides denial of irrigation
facilities to the rehabilitated tribal population.
(Paragraph 2.14)
xiii
Chapter Summary
Allocation to Panchayat Raj Institutions by the State
Government during 2004-07 constituted only 14 to 16 per cent
of the total budget of the State
Despite being pointed out in earlier Audit Reports, delays
persisted in forwarding of annual accounts of Zilla
Panchayats and Taluk Panchayats for audit
Total receipts and expenditure in Panchayat Raj Institutions
increased steadily during 2004-07
Capital expenditure
compared to 2005-06
declined
sharply
during
2006-07
Abnormal delays were noticed in release of Twelfth Finance
Commission grants to Panchayat Raj Institutions
The devolution of funds and functions to Panchayat Raj
Institutions was not as envisaged in the Constitution
Despite being commented in earlier Audit Reports, the
internal control mechanism in Zilla Panchayats was
inadequate
3
CHAPTER I
A OVERVIEW OF THE
ACCOUTS AD FIACES OF
ZILLA PACHAYATS AD TALUK PACHAYATS
1.1
Introduction
1.1.1 The Karnataka Panchayat Raj (KPR) Act, in keeping with the 73rd
Constitutional amendment, was enacted in 1993 to establish a three-tier
Panchayat Raj Institution (PRI) system at the village, taluk and district levels
in the State. The PRI system comprises elected bodies – Grama Panchayats
(GPs) at the village level, Taluk Panchayats (TPs) at the taluk level and Zilla
Panchayats (ZPs) at the district level. As per the 2001 census, the total
population of the State was 5.29 crore, of which the rural population
constituted 3.48 crore. As of March 2008, there were 29 ZPs1, 176 TPs and
5,628 GPs in the State.
1.1.2 Besides functioning as institutions of local self government, the PRIs
also aim to promote participation of people and effective implementation of
rural development programmes. The overall supervision, coordination and
implementation of development schemes at taluk and district levels and
preparation of the plan for the development of the district is vested with the
ZPs.
1.1.3 The Comptroller and Auditor General of India (CAG) has been
auditing and certifying the accounts of the ZPs and TPs as entrusted under
Section 19(3) of CAG’s (DPC) Act, 1971. The Controller of State Accounts
has been auditing the accounts of GPs under the KPR Act.
1
ZPs - Chikkaballapur and Ramanagara were formed during 2007-08
5
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
1.2
Organisational structure and functions
1.2.1
The organisational structure is indicated below:
At the State level
Principal Secretary/Secretary of Departments, the functions
of which are entrusted to PRIs
At the district level
Elected body headed by an
Adhyaksha and assisted by
Statutory Committees
Chief Executive Officer
Chief Planning
Officer
Deputy Secretary
(Development)
Chief
Accounts
Officer
At the taluk level
Elected body headed by an
Adhyaksha and assisted by
Statutory Committees
Executive Officer
At the village level
Elected body headed by an
Adhyaksha
Secretary
6
Chapter I – An overview of the accounts and finances of ZPs and TPs
1.2.2
The broad details of responsibility within the ZPs are as under:
Authority
District level officers and departments of
Zilla Panchayat
Zilla Panchayat
Chief Executive Officer (CEO)
Chief Accounts Officer (CAO)
Finance, Audit and Planning Committee
(FAPC)
1.3
Functions
Preparation of budget and Annual
Action Plan and implementation of
developmental works
Approval of budget and Annual Action
Plan and review of implementation of
schemes
Allocation of funds to implementing
agencies and overall control and
supervision of all functions/schemes
Preparation of monthly and annual
accounts and their submission to State
Government
Review of accounts, framing of budget,
general supervision of Receipts and
Expenditure and monitoring of
programme implementation
Funding of Panchayat Raj Institutions
1.3.1 The State and Central Governments funded the PRIs through grants-inaid for general administration and developmental activities. The funding by
the State Government was on the lines of accepted recommendations of the
State Finance Commission considering factors like population, literacy, health,
irrigation, medical facilities, etc. The State Government released block grants
on a quarterly basis. The Central Government also released funds directly to
PRIs for developmental activities.
Allocation to PRIs by the State
Government during 2004-07 ranged from 14 to 16 per cent of the total budget
of the State as shown below:
Year
2004-05
Total budget provision of
Allocation to PRIs
the State
(Rupees in crore)
37,380.05
5,180.62
Percentage
14
2005-06
41,528.17
6,842.75
16
2006-07
52,492.16
8,135.16
16
The Second State Finance Commission had recommended (December 2002)
that from the financial year 2003-04, 32 per cent of NLGORR2 of the State
was to be allocated to PRIs. The State Government did not accept this
recommendation and released 24 and 27 per cent of NLGORR of the State to
PRIs during the years 2004-05 and 2005-06 respectively. Though the State
Government decided (June 2006) to release 32 per cent of the NLNORR3 of
2
3
Non-Loan Gross Own Revenue Receipts
Non-Loan Net Own Revenue Receipts
7
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
the State from the year 2006-07 onwards, the actual releases constituted only
28 per cent, as shown below.
Amount
released to
PRIs
(Rupees in crore)
Year
LGORR
of the State
2004-05
20,545.00
4,906.08
24
2005-06
22,507.00
6,088.61
27
7,767.93
28
Percentage
LORR
of the State
2006-07
27,400.00
1.3.2 The ZPs deposited grants-in-aid and receipts from other sources4, into
ZP Funds maintained in treasuries. Such ZP Funds were outside the
Consolidated Fund of the State but formed part of its Public Account. The
ZPs also deposited funds received from the Government of India/externally
aided projects and State share of Central Sector/Centrally Sponsored Schemes
in bank accounts, as stipulated in scheme guidelines.
1.3.3 The TPs conducted their financial transactions through TP funds held
in the treasury and the scheme funds held in banks. The GPs carried out their
financial operations through GP funds maintained in the treasury/any
approved cooperative/scheduled bank.
1.4
Financial position of Zilla Panchayats/Taluk Panchayats
The State Government modified (September 2004) the accounting procedure
and method of release of funds to various levels of PRIs from 2005-06. The
method of routing the funds to TPs and GPs through ZP was discontinued and
funds were directly released to the respective PRIs. The accounts of the TPs
were excluded from the annual accounts of ZPs since 2005-06.
Delays
persisted in
forwarding of
annual
accounts for
audit
1.4.1 The KPR Act stipulated that the annual accounts were to be passed by
the ZPs within three months from the close of the financial year and forwarded
to the Principal Accountant General (PAG) for audit. Despite being pointed
out in earlier Audit Reports, there were, however, delays ranging between two
and nine months in forwarding of annual accounts for 2006-07 by 23 ZPs.
4
Includes miscellaneous receipts like recoveries of overpayment, sale of tender forms/
unserviceable items, etc.
8
Chapter I – An overview of the accounts and finances of ZPs and TPs
1.4.2 The financial position of ZPs as aggregated from their certified annual
accounts for the years 2004-05 to 2006-075 was as exhibited in the table and in
Chart I.
Receipts
9,347.30
Revenue
2004-05
2005-06
6,035.78
^^
DDR heads
Opening balance
Total
Receipts
3,311.52
Revenue
4,273.11
DDR heads
Opening balance
Total
Receipts
Revenue
2006-07
1,011.34
10,358.64
4,929.76
656.65
1,183.15
6,112.91
4,736.55
4,204.78
DDR heads
Opening balance
Total
531.77
1,451.04
6,187.59
Expenditure
Revenue
Capital
DDR heads
Closing balance
Total
Expenditure
Revenue
Capital
DDR heads
Closing balance
Total
Expenditure
Revenue
Capital
DDR heads
Closing balance
Total
(Rupees in crore)
9,085.70
5,485.99
312.71
3,287.00
1,272.94
10,358.64
4,578.27
3,442.51
397.24
738.52
1,534.64
6,112.91
4,356.90
3,716.09
157.92
482.89
1,830.69
6,187.59
^^ Debt, Deposit and Remittance
Figures from the year 2005-06 do not include receipts and expenditure of TPs which are
exhibited under paragraph 1.4.4.
The difference between the opening balance of the current year and the closing balance of the
previous year was due to revision of annual accounts consequent to write-back of funds by
State Government and adoption of figures audited by Chartered Accountants in respect of
schemes accounts
Note:
1830.69
4356.90
4736.55
1451.04
1183.15
2000
1000
1011.34
5000
4000
3000
1272.94
6000
1534.64
4929.76
8000
7000
4578.27
10000
9000
9085.70
9347.30
Chart I
Financial position of Zilla Panchayats
(Rupees in crore)
0
2004-05
Opening Balance
5
2005-06
Receipts
Expenditure
2006-07
Closing Balance
Comments restricted to the year up to which Audit had certified the accounts of ZPs
9
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
1.4.3 Similar to ZPs, the TPs were also required to approve the annual
accounts, within three months from the close of the financial year and forward
the same to the PAG for audit. The provisions of KPR Act stipulated a
consolidated certified report to be placed in the Legislature. As of December
2008, the position of receipt of annual accounts from TPs and their audit was
as shown below.
Year
Total
number
of TPs
2005-06
Annual
accounts
received
Audited
Remarks
175
166
Annual Accounts of TP - Sindhanur yet
to be received
173
143
176
2006-07
Annual Accounts not received from
TPs - Bangarpet, Manvi and Sindhanur
1.4.4 The financial position of the TPs, as aggregated from their annual
accounts received for the years 2005-06 and 2006-07 (which were yet to be
certified) was as exhibited in the table below.
Receipts
Revenue
2005-06
DDR heads
Opening balance
Total
Receipts
Revenue
2006-07
DDR Heads
Opening balance
Total
3,466.91
3,307.36
159.55
235.18
3,702.09
3,819.96
3,757.56
62.40
347.21
4,167.17
Expenditure
Revenue
Capital
DDR heads
Closing balance
Total
Expenditure
Revenue
Capital
DDR Heads
Closing Balance
Total
(Rupees in crore)
2,910.99
2,845.07
1.49
64.43
791.10
3,702.09
3,452.21
3,349.74
1.63
100.84
714.96
4,167.17
Note :
The difference in closing balance of 2005-06 and opening balance of 2006-07 was due to
write-back of funds by State Government and incorporation of audited figures.
1.5
Sectoral Finances of Panchayat Raj Institutions
1.5.1 Sector-wise data on the finances of the PRIs for the past three years is
given as follows:
10
Chapter I – An overview of the accounts and finances of ZPs and TPs
(Rupees in crore)
2004-05
OPLA
PLA
TOTAL
2005-06
OPLA
PLA
RECEIPTS
6
Total Receipts
2576.14
3459.64
6035.78
TOTAL
PLA
2006-07
OPLA
TOTAL
*
3454.67
4125.80
7580.47
3621.49
4340.85
7962.34
2682.75
3604.83
6287.58
3241.19
3824.64
7065.83
EXPEDITURE*
Revenue Expenditure
2063.60
3422.39
5485.99
General Services
-
84.16
84.16
0.19
96.62
96.81
0.22
94.85
95.07
Stamp Duty
Public Works
-
84.16
84.16
0.23
(-)0.04
96.62
0.23
96.58
0.22
94.85
95.07
842.62
2383.61
3226.23
1507.48
3075.88
4583.36
1486.27
3237.85
4724.12
221.01
1840.40
2061.41
706.16
2445.26
3151.42
719.87
2560.65
3280.52
114.39
271.21
385.60
151.90
303.61
455.51
211.97
281.06
493.03
294.41
1.64
296.05
276.43
4.03
280.46
112.46
2.83
115.29
Social Services
Education, Sports, Art and
Culture
Health and Family
Welfare
Water supply and
Housing
Welfare of SC/ST/OBC
81.78
216.26
298.04
145.55
247.93
393.48
183.95
286.38
470.33
Social Welfare and
Nutrition
131.03
54.10
185.13
227.44
75.05
302.49
258.02
106.93
364.95
Economic Services
785.99
462.98
1248.97
1054.94
428.46
1483.40
923.45
460.04
1383.49
Agriculture and allied
activities
128.04
176.44
304.48
195.59
216.04
411.63
223.11
219.03
442.14
Rural Development
512.51
211.46
723.97
674.50
126.76
801.26
473.21
148.01
621.22
27.02
-
27.02
39.04
-
39.04
10.74
-
10.74
3.28
24.09
27.37
0.82
13.76
14.58
0.36
15.45
15.81
3.03
4.58
35.00
3.03
39.58
0.99
8.23
0.13
39.88
1.12
48.11
0.22
9.44
41.44
0.22
50.88
0.30
-
0.30
0.34
-
0.34
0.36
0.04
0.40
106.84
11.43
118.27
130.94
27.15
158.09
201.07
30.81
231.88
0.39
4.56
4.95
4.49
4.74
9.23
4.94
5.26
10.20
182.44
468.04
650.48
5.19
-
5.19
-
-
-
-
-
-
-
-
-
0.58
-
0.58
Special Areas
Programmes
Irrigation and Flood
Control
Energy
Industry and Minerals
Science, Technology and
Environment
Transport
General Economic
Services
TP/GP expenditure
Deposits of Local Bodies
– Zilla Panchayat funds
Deposits of Local Bodies
–Taluk Panchayat funds
Bank (ZP and TP)
-
-
-
6.55
3.87
10.42
54.72
30.61
85.33
252.55
23.60
276.15
108.40
-
108.40
775.95
1.29
777.24
Capital Expenditure
312.71
-
312.71
398.73
-
398.73
159.55
-
159.55
General Services
Public Works
Social Services
280.35
-
280.35
377.76
-
377.76
140.76
-
140.76
2.93
-
2.93
18.48
-
18.48
4.94
-
4.94
3.63
-
3.63
0.60
-
0.60
0.59
-
0.59
265.14
-
265.14
355.66
-
355.66
127.76
-
127.76
1.99
-
1.99
1.84
-
1.84
6.88
-
6.88
6.66
-
6.66
1.18
-
1.18
0.59
-
0.59
Education, Sports, Art and
Culture
Health and Family
Welfare
Water Supply and
Housing
Welfare of SC/ST/OBC
Social Welfare and
Nutrition
6
The ZPs exhibited in their annual accounts, receipts distinctly under ‘Plan’ and ‘Non-Plan’,
as allocated by State Government and as stipulated in the ZP Rules. Such depiction,
however, is not required either according to normal Government accounting practice or in
the accounts formats suggested by the CAG, for PRIs.
11
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2004-05
OPLA
32.35
-
32.35
20.97
2005-06
OPLA
-
0.17
-
0.17
0.98
-
-
-
5.26
-
5.26
PLA
Economic Services
Agriculture and allied
activities
Rural Development
Irrigation and Flood
Control
Industry and Minerals
Transport
Others
TP expenditure
Total Expenditure
20.97
18.79
-
0.98
1.35
-
1.35
-
-
-
6.15
-
6.15
2.05
-
2.05
0.61
-
0.61
PLA
TOTAL
PLA
TOTAL
18.79
0.13
-
0.13
0.17
-
0.17
0.19
-
0.19
26.78
0.01
0.01
2376.31
3422.39
26.78
0.01
0.01
5798.70
17.77
3081.48
3604.83
17.77
6686.31
10.47
0.02
3400.74
3824.64
10.47
0.02
7225.38
Note:
*
on-Plan
expenditure
exceeded the
Plan
expenditure.
There was a
sharp decrease
in capital
expenditure
during 2006-07
TOTAL
2006-07
OPLA
-
Figures as rounded off
Includes TP figures, however, as mentioned in paragraph 1.4.4 they are not certified.
1.5.2 It would be observed from the data given that the total receipts of PRIs
during 2006-07 increased by 32 per cent from the year 2004-05. Though there
was steady increase under both ‘Plan’ and ‘Non-plan’ revenue expenditure
during 2004-07, ‘Non-plan’ expenditure exceeded the ‘Plan’ expenditure
during all the years. While the revenue expenditure during 2006-07 increased
by 29 and 12 per cent, the capital expenditure drastically decreased by 49 and
60 per cent compared to 2004-05 and 2005-06 respectively. This was
attributable mainly to lesser expenditure on basic services like ‘water supply
and housing’ and ‘education, sports, art and culture’ during 2006-07.
Further, though there was overall increase in revenue expenditure under Social
Sector Services, the expenditure booked under ‘water supply and housing’
during 2006-07 declined by 59 per cent compared to previous year. The
expenditure on Economic Services showed a fluctuating trend during 2004-07
which was attributable to variation in expenditure under ‘Rural Development’
heads.
The ZPs did not
follow the
stipulations of
KPR Act
scrupulously
The formats prescribed for the preparation of accounts under KPR Act
stipulated that the sector-wise expenditure had to be exhibited. It was,
however, noticed during 2006-07 that 13 ZPs7 did not indicate sector-wise
expenditure for an amount of Rs.619.77 crore in respect of funds held in bank
accounts. Similarly, 51 TPs did not indicate sector-wise expenditure for an
amount aggregating Rs.157.47 crore.
7
Bangalore (Rural), Bellary, Bidar, Dakshina Kannada, Davanagere, Gadag, Hassan, Kodagu,
Mysore, Raichur, Shimoga, Tumkur and Uttara Kannada
12
Chapter I – An overview of the accounts and finances of ZPs and TPs
Chart II
‘Plan’ and ‘on-Plan’ expenditure in total expenditure during
2004-05 to 2006-07
(Rupees in crore)
8000
1000
3824.64
3400.74
6686.31
3081.48
2000
2376.31
3000
3422.39
4000
3604.83
5798.70
6000
5000
7225.38
7000
0
2004-05
'Plan' expenditure
1.6
2005-06
'on Plan' expenditure
2006-07
Total expenditure
Twelfth Finance Commission Grants
The Twelfth Finance Commission (TFC) recommended grants of Rs.888 crore
to PRIs in the State for the years 2005-06 to 2009-10. The funds were to be
utilised by the PRIs to improve the service delivery in respect of water supply
and sanitation. The State Government allocated (November 2005) TFC grants
in the ratio 10:20:70 among ZPs, TPs and GPs and issued guidelines
delineating the items of works to be executed by each level of PRI. As of
March 2008, the Government of India (GOI) released an amount aggregating
Rs.444 crore to the State Government (share of PRIs). Audit-check of the
records in selected8 PRIs regarding funds released and expenditure incurred
under TFC grants revealed the following.
1.6.1
Delayed/non-release of funds
(i)
TFC guidelines stipulated that the GOI was to release the funds to
State Government which in turn was to be transferred to different tiers of PRIs
within 15 days of receipt failing which interest at the Reserve Bank of India
rate was to be paid for the delayed period. As there were delays in transfer of
funds, the State Government released (May 2006 and October 2007) an
amount of Rs.68.61 lakh as interest to PRIs.
8
10 ZPs, 67 TPs and 422 GPs
13
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
It was, however, noticed that interest of Rs.60.28 lakh itself was due in respect
of PRIs test-checked (as worked out by Audit at the rate of 5.5 per cent) as
there were delays ranging from 17 to 547 days in actual credit of allocated
funds to individual account of PRIs.
Further, it was also noticed that the interest payment was irregularly charged
to a “Plan” Head of account9, under RDPR resulting in denial of funds (to the
extent of interest paid) to envisaged rural developmental activities.
(ii)
Even as of March 2008, 55 test-checked PRIs had not received
amounts aggregating Rs.55.93 lakh due to them under different instalments.
The failure of the nodal department (RDPR) in following up the releases and
actual credit to respective accounts facilitated blocking up of above funds with
different banks.
1.6.2
Execution of ineligible works
The guidelines issued by the State Government broadly classified the items of
works to be taken up by different tiers of PRIs. It was noticed that the testchecked PRIs incurred an expenditure of Rs.8.64 crore during 2005-08 on
execution of works (formation of roads, construction activities, etc.) not
contemplated in the guidelines. The expenditure incurred on such ineligible
works was, thus, irregular.
1.7
Devolution of funds, functions and functionaries
The 73rd amendment to the Constitution envisaged devolution of functions
mentioned in the 11th Schedule to PRIs. Audit observed the following
deficiencies in devolution of functions, funds and functionaries to the PRIs.
1.7.1
1.7.1.1
Transfer of Functions
Activity Map
The State Government with an intention to strengthen the independent
functioning of PRIs issued (August 2003) an Activity Map (AM) indicating
the redistribution of functions specified among the PRIs. Scrutiny of records
of 113 PRI units10 revealed that all the functions listed in the AM are not being
carried out by the PRIs as detailed in Appendices 1.1 and 1.2. Few
deficiencies noticed in transfer of functions to PRIs are detailed as follows:
9
2515-00-101-0-09-101 (Plan)
7 ZPs, 13 TPs and 93 GPs
10
14
Chapter I – An overview of the accounts and finances of ZPs and TPs
In the AM issued by the State Government, the subject of Public
Distribution System had not been transferred to any tier of the PRIs.
The State Government transferred (July 2005) the subject to PRIs but
subsequently (February 2006) modified its earlier decision and
centralised the distribution of essential commodities and other food
items under the direct control of Commissioner of Food, Civil Supplies
and Consumer Affairs, a State Government Department. This resulted
in grass-root democratic institutions having no role in the distribution
of essential commodities to the needy people.
As per the AM, the function of establishment and management of
student hostels for SC/ST under the subject of Social Welfare was to
be transferred to PRIs. It was, however, noticed that the said function
was implemented both by the State Government and PRIs.
The State Government established (June 2001) Backward Classes
Department Buildings Construction Society as an agency for
implementation of the function of establishment and management of
hostels for backward classes. Even after the function was devolved to
PRIs, the Society continued to undertake the said function against the
spirit of devolution.
Similarly, District Milk Unions and Karnataka Milk Federation and
Karnataka Co-operative Poultry Federation were the State Government
agencies established for implementation of Dairy Development and
Poultry Development functions respectively under the subject of
Animal Husbandry resulting in diluting the spirit of decentralisation.
1.7.1.2
$on-transfer of schemes to PRIs
State Government issued orders (October 2004) for implementation of
certain schemes relating to transferred subjects to PRIs with budgetary
allocations effective from April 2005. Scrutiny, however, revealed that
two schemes11 under Public Health Sector even though transferred
were continued to be implemented under the State sector.
Scrutiny also revealed that for 178 Community Health Centres (CHCs)
in the state, only 136 ambulances were provided, of which 23
ambulances were off road. Similarly, no blood banks were established
in health institutions under ZP sector in the entire state. The Director,
Health and Family Welfare Services, Bangalore stated (February 2009)
that provision of blood storage units in 109 First Referral Units were
11
Provision of ambulance and establishment of blood banks
15
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
under consideration out of National Rural Health Mission funds to
meet the need for safe blood in emergency situation.
1.7.2
Transfer of Funds
Devolution of funds to PRIs was a natural corollary to implement the
transferred functions. Scrutiny revealed that the State Government entrusted
the procurement and supply of medicines for health centres/institutions under
PRIs to Government Medical Stores (GMS), Bangalore through Karnataka
State Drugs Logistic and Warehousing Society. However, the funds were
allocated to the extent of 60 per cent through budgetary allocation to PRIs and
the rest 40 per cent directly to GMS. Even the stipulated allocation was not
adhered to and the percentage of reduction in allocation to ZP sector ranged
from 9 to 41 during the years 2005-06 to 2007-08 as detailed in Appendix 1.3.
In respect of health institutions such as sub-centres, mobile health units, dental
units, etc., under the jurisdiction of PRIs, 100 per cent allocation was provided
to GMS which was against the spirit of devolution of funds to PRIs. Audit also
observed that funds amounting to Rs.15.38 crore pertaining to GMS were
surrendered by Director of Health and Family Welfare Services at the end of
the financial years for 2005-08. Out of this, Rs. 3.30 crore pertained to
allocation made to GMS for procurement of medicines to health institutions
under the jurisdiction of PRIs. Thus, the purpose for which the funds were
provided was defeated.
1.7.3 Transfer of Functionaries
1.7.3.1
Control over functionaries
The KPR Act stipulated that the State Government as it considered necessary
may depute the required personnel of Group A, B, C & D including officers
belonging to All India Services to ZPs and TPs for discharge of the functions
entrusted to them. The PRIs had no powers to transfer these officials. The
CEO of the ZP had the powers under Karnataka Civil Service (Classification,
Control & Appeal Rules 1957) Rules to take disciplinary action and to impose
minor penalties. This had resulted in dual control over these officials by State
Government as well as by the ZP.
1.7.3.2
Shortage of functionaries
The AM had assigned (August 2003) 210 functions to the GPs as brought out
in Appendix 1.1. Though the State Government decided (January/ March
2008) the staffing pattern for GPs by creation of additional posts, no additional
posts were sanctioned till March 2008. This resulted in GPs not having
16
Chapter I – An overview of the accounts and finances of ZPs and TPs
adequate staff to discharge the newly assigned functions. The State
Government stated (March 2008) that action was being initiated for
strengthening the GPs.
1.8
Laxity of internal controls
1.8.1 The KPR Act and codal provisions, inter alia, prescribed the following
internal control mechanism for PRIs and the CAOs of ZPs:
ensure remittance of statutory deductions to Government account
watch submission of non-payable detailed contingent (NDC) bills for
amounts drawn on abstract contingent (AC) bills
ensure reconciliation of expenditure figures by the Controlling
Officers/heads of departments of ZPs.
1.8.2 At the end of March 2007, recoveries aggregating Rs.1.04 crore made
by 12 ZPs towards income tax, sales tax and royalty had not been remitted to
Government account as detailed below:
Serial
umber
1
2
3
4
5
6
7
8
9
10
11
12
In 14 ZPs,
detailed
accounts for
Rs.4.64 crore
drawn on AC
bills were not
submitted
Recoveries not remitted
Zilla Panchayat
Income tax
Bangalore (Rural)
Belgaum
Bellary
Bidar
Chikmagalur
Dakshina Kannada
Gulbarga
Hassan
Haveri
Kolar
Kodagu
Udupi
Total
Grand total
(Source: Annual Accounts of ZPs)
1.04
14.28
1.95
0.05
5.36
1.52
0.28
0.90
25.38
Sales tax
(Rupees in lakh)
8.63
1.97
18.81
7.28
0.25
6.08
1.69
0.59
0.13
1.15
0.06
46.64
104.23
Royalty
0.64
2.10
6.00
1.06
21.44
0.97
32.21
1.8.3 While codal provisions permit Drawing and Disbursing Officers
(DDOs) to draw funds on AC bills towards contingent charges required for
immediate disbursement, DDOs are required to submit the NDC bills to the
CAOs before the 15th of the following month. However, it was noticed in 14
ZPs that NDC bills were not submitted (December 2008) by 49 drawing
officers for amounts aggregating Rs.4.64 crore drawn on more than 303 AC
bills, some of which were drawn as early as 1986-87 (Appendix 1.4).
17
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Despite this irregularity having been pointed out in previous Reports, the
CAOs did not initiate action against officers who had failed to render detailed
accounts.
1.8.4 The Controlling Officers/heads of departments of ZPs were responsible
for reconciliation of their expenditure figures with those booked by CAOs.
However, seven Controlling Officers of three ZPs12 had not reconciled
(December 2008) expenditure of Rs.62.28 crore incurred during 2007-08 as
detailed below:
Serial
umber
umber of
departmental
officers
Zilla Panchayat
2007-08
umber of
Amount not
departmental officers
reconciled
whose expenditure was
(Rupees in crore)
not reconciled
1
Bidar
21
1
0.28
2
Chamarajanagar
19
1
2.69
3
Kolar
19
5
59.31
7
62.28
TOTAL
1.9
In 10 ZPs,
investment of
Rs.6.78 crore
on 28
incomplete
works
remained idle
Investment without returns
As of March 2008, 28 works taken up for execution prior to 2005-06, on
which 10 ZPs made an aggregate investment of Rs.6.78 crore, remained
incomplete (information as furnished by the ZPs) even though these works
were to be completed in two years and the State Government had issued
instructions to accord priority to incomplete works in allocation of funds over
the new works (Appendix 1.5).
Many such instances have been highlighted under Chapter II of this Report
and in earlier Reports.
1.10
397 cases of misappropriation/
defalcation
involving
Rs.24.47 crore
were pending
Cases of misappropriation/defalcation
As of March 2008, 397 cases of misappropriation/defalcation involving
Rs.24.47 crore were pending at various stages in 26 ZPs (Appendix 1.6). The
pendency, as furnished by the ZPs, was as under.
Under investigation
12
Pending in Court
(Rupees in crore)
Total
Others
umber of
cases
Amount
umber of
cases
Amount
umber of
cases
Amount
umber of
cases
Amount
269
15.34
47
5.67
81
3.46
397
24.47
Bidar, Chamarajanagar and Kolar
18
Chapter I – An overview of the accounts and finances of ZPs and TPs
Delays in settlement of these cases may result in postponement of
recoveries/non-recovery and officials responsible for irregularities going
unpunished.
1.11
Conclusion
Despite being commented in earlier Audit Reports, the delay in forwarding of
Annual Accounts persisted. The total receipts and expenditure of PRIs
steadily increased during the period 2004-07. ‘Non-plan’ expenditure
exceeded the ‘Plan’ expenditure during all the years. There was a sharp
decline in expenditure on capital assets during 2006-07 compared to previous
years. There were delays in transfer of funds to PRIs under TFC Grants.
Substantial expenditure had been incurred on ineligible works out of TFC
grants. The devolution of funds and functions to PRIs was not as envisaged in
the Constitution. The internal controls in the ZPs were inadequate as there
were instances of non-reconciliation of expenditure figures and nonsubmission of NDC bill for funds drawn on AC bills. Large number of cases
of misappropriation/ defalcation was pending in ZPs.
1.12
Recommendations
Annual accounts should be forwarded within the stipulated time
frame.
There is need to ensure timely release of funds under TFC grants
to avoid interest liability.
Thrust should be given on devolution of funds, functions and
functionaries to PRIs to have meaningful decentralisation.
Immediate steps be initiated for submission of NDC bills and
settlement of misappropriation cases.
19
CHAPTER II - RESULTS OF AUDIT
SECTIO ‘A’ – PERFORMACE REVIEWS
RURAL DEVELOPMET AD PACHAYAT RAJ
DEPARTMET
2.1
Suvarna Gramodaya Yojana
Highlights
To develop vibrant village communities by adopting an intensive and
integrated approach to rural development, the State Government launched
the Suvarna Gramodaya Yojana in October 2006. The implementation of
the Scheme suffered due to laxity of the State Government in preparatory
procedures and inadequacies in convergence with other ongoing schemes.
There was delay in approval of action plans, diversion of funds, nonprioritisation of developmental works, absence of monitoring mechanism,
etc.
There was no perspective plan for development of villages and the
selection of villages was made by the State Government without specific
criteria.
(Paragraphs 2.1.6.1 and 2.1.6.5)
[
The on-Governmental Organisations prepared the development plans
without the approval of Grama Sabhas and the annual action plans were
belatedly approved.
(Paragraphs 2.1.6.2 and 2.1.6.3)
As against the envisaged allocation of Rs.1,000.60 crore for development
of 1,200 villages during 2006-07, State Government released only
Rs.458.84 crore as of March 2008. Further, the funds were released at the
fag end of the year and were parked in bank accounts in order to avoid
lapse of grants. Inconsistencies were also noticed in release of grants.
(Paragraphs 2.1.7.1 and 2.1.7.2)
Allocations under sector programmes by the line departments were
meagre.
(Paragraph 2.1.7.4)
The approved works were not completed due to delays in entrustment of
works to the executing agencies. Developmental works were not
prioritised.
(Paragraphs 2.1.8.1 and 2.1.8.2)
23
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Training in computers and avenues for non-agricultural employment
were not provided in any of the test-checked districts.
(Paragraphs 2.1.8.3 and 2.1.7.5)
Mechanism for monitoring and evaluation of the scheme was absent.
(Paragraph 2.1.10)
2.1.1
Introduction
In order to improve the quality of life in the villages and increase the
productive capacity of the economic activities of rural communities, Suvarna
Gramodaya Yojana (Scheme) was initiated at the commencement of the
Golden Jubilee Celebrations of the formation of the State of Karnataka. The
Scheme was launched (October 2006) in the State and envisaged to cover
1,000 villages of medium size each consisting about 700 to 750 families, every
year. An average estimated outlay of Rs.3.29 crore was envisaged for
developmental works in a village of which Rupees One crore was to be
released directly under the Scheme and the rest from the ongoing sector
programmes. The Scheme envisaged developmental activities such as roads
and drainages, construction of Anganwadis, Samudaya Bhavanas, drinking
water supply, household and community toilets, non-agricultural employment,
disposal of garbage by construction of waste disposal pit outside the village
area, watershed development programme, etc.
The specific objectives of the Scheme were to
upgrade the physical environment of the selected villages for
improving the quality of life
fully develop the income generating potential of land based
activities
provide full and adequate infrastructure for human resources
development including education, health services and child care
facilities
generate significant levels of non-agricultural employment,
especially for educated unemployed youth
support community awareness and development through self-help
groups, cultural associations, etc.
24
Chapter II – Results of Audit
2.1.2
Organisational structure
The Organisational structure for implementation of the Scheme as of March
2008 was as under:
Organisation/Agency
Rural Development and Panchayat
Raj Department
Chief Executive
Panchayat
Officer,
Zilla
Executive Engineer, Panchayat Raj
Engineering Division, Karnataka
Land Army Corporation and
Nirmithi Kendra
Grama Panchayats
State High Level Committee
2.1.3
Responsibility
Selection of villages
Approval of Annual Action Plans
Release of funds
Supervision of overall implementation of the
Scheme
Coordinating the implementation including various
sector programmes of other line departments
Approval of Action Plans of sector programmes of
other line departments
Release of Scheme grants and funds from district
sector budget outlays
Delegating powers for execution
Monitoring and reporting the progress of
implementation
Implementation of the Scheme
Assist in the preparation of draft plans
Providing policy directions
Approval of overall outlays
Review the progress of implementation
Scope of audit and methodology
Performance appraisal of the implementation of the Scheme up to March 2008
was conducted (July–November 2008) by test-check of records of Secretary,
Rural Development and Panchayat Raj (RDPR) Department, eight Zilla
Panchayats13 (ZPs) including 106 villages (Appendix 2.1), Panchayat Raj
Engineering Divisions (PREDs), Karnataka Land Army Corporation (KLAC)
and Nirmithi Kendra covering an expenditure of Rs.45.32 crore out of
Rs.200.37 crore (23 per cent).
The audit objectives and methodology for the audit were discussed with the
Secretary, RDPR during an Entry Conference held in July 2008. The draft
review was forwarded (November 2008) to the Principal Secretary to
Government of Karnataka, RDPR Department. The Exit Conference was held
on 5 January 2009 wherein the Department generally accepted the
observations pointed out. Paragraph-wise comments of the State Government
are awaited (March 2009).
13
Bagalkot, Bangalore (Rural), Bidar, Chamarajanagar, Kodagu, Mandya, Shimoga and
Tumkur
25
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.1.4
Audit objectives
Performance appraisal of the Scheme was conducted to assess whether the
selection of villages was as per guidelines
release of funds was adequate and timely
implementation of the Scheme was as planned
convergence of other programmes was as envisaged
monitoring and evaluation was in place.
2.1.5
Audit criteria
The audit criteria in evaluating the performance of the scheme were
Scheme guidelines and conceptual outline issued by the State
Government
State Government orders, notifications, circulars and instructions
issued from time to time
Annual Action Plans and Development Plans
Proceedings of various committees.
Audit findings
The audit findings are discussed in the succeeding paragraphs.
2.1.6
2.1.6.1
o
perspective
plan was
framed
Absence of perspective planning
The Scheme was to promote comprehensive development of 1,000 villages
every year. Audit observed that the State Government had selected 1,200
villages for development during 2006-07. No further selection of villages was
made in subsequent years. Inclusion of additional 200 villages did not have
the approval of High Level Committee (HLC). This indicated absence of
perspective planning which is essential for comprehensive development of
1,000 villages every year.
2.1.6.2
Development
plans were
prepared
without
consulting the
GPs
Planning
Preparation of development plans without consulting GPs
The Non-Governmental Organisations (NGOs) were to prepare the
development plan incorporating the available infrastructure of the village and
future requirements in consultation with the Grama Panchayats (GPs).
However, it was noticed in 39 cases out of 58 resolutions test-checked that the
NGOs prepared the development plans without involvement of GPs.
26
Chapter II – Results of Audit
Preparation of development plans without involving the grass-root level
beneficiaries dilutes the spirit of decentralised planning.
2.1.6.3
Annual Action
Plans were
approved after
10 months of
launching the
Scheme
The main objective of preparation of Annual Action Plans (AAPs) was to
provide a definite direction for the successful implementation of the Scheme
and also to ensure regular monitoring of the progress during the course of the
year. It was observed in audit that though the Scheme was launched in
October 2006, the State Government approved the AAPs prepared by ZPs
based on the development plans of NGOs only during August 2007 to
December 2007 after a time gap of 10 months. However, funds amounting to
Rs.164.70 crore were released in February 2007 itself. These indicated laxity
in preparatory procedures for implementation of the Scheme at the State level.
2.1.6.4
Action plans
were approved
without
assessing
necessity
Delay in approval of Annual Action Plans
Approval of Action Plans without assessing necessity
According to the development plans prepared by the NGOs, there was no
requirement of community centres in two test-checked villages of ZPs selected
for Audit. However, in the approved action plan, two community centres were
included and an allocation of Rs.26.50 lakh was made for such centres by the
State Government indicating that approval of action plan was done without
considering the necessity of such infrastructure.
2.1.6.5
Selection of villages
A conceptual outline of the Scheme envisaged selection of villages based on
criteria like large population, proximity to market centres, general accessibility
through a good network of roads, potential for development into a growth
centre, etc. However, the scheme guidelines did not specify any criteria to be
adhered to in the selection of villages.
Substitution of
villages led to
avoidable
litigation and
blocking up of
Rs.60 lakh
The State Government selected (December 2006) four villages in Virajpet
taluk and released Rs.60 lakh to GPs for execution of developmental works.
However, the selected villages were substituted by the State Government with
another 10 villages (March 2007) for reasons not made available to audit. GPs
of these four villages have moved the Hon’ble High Court of Karnataka for
reconsideration. Thus, substitution of villages led to avoidable litigation and
blocking up of Rs.60 lakh meant for developmental works.
27
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.1.7
Financial performance
2.1.7.1 The details of allocation, release and expenditure under the scheme as
of March 2008 were as follows:
Year
Allocation
2006-07
200.00
Amount released by
State Government
164.70
2007-08
350.00
294.14
(Rupees in crore)
Expenditure incurred on the
Scheme
Nil
*
200.37
TOTAL
550.00
458.84
Source: Progress Reports furnished by RDPR
* includes diversion of funds to other schemes
200.37
The Scheme envisaged Rs.1,000.60 crore to complete the comprehensive
development of 1,200 villages. As against this, Rs.164.70 crore was released
during February 2007. No expenditure was incurred on developmental works
during the year 2006-07 due to delay in approval of AAPs. The State
Government diverted (August 2007–March 2008) funds to the tune of
Rs.104.11 crore for other schemes14 of which Rs.79.11 crore was provided to
programme which was not implemented in the villages selected under the
Scheme.
The details of releases made by State Government, ZP and expenditure of testchecked ZPs as of March 2008 were as follows:
Zilla Panchayats
Releases by State
Government
2006-07
2007-08
Releases by Zilla Panchayats
2006-07
2007-08
Total
(Rupees in lakh)
Expenditure
(percentage)
2007-08
Balance
Bangalore (Rural)
465.00
375.00
465.00
375.00
840.00
501.53 (60)
338.47
Chamarajanagar
360.00
575.00
360.00
575.00
935.00
799.68 (86)
135.32
Mandya
915.00
Nil
915.00
Nil
915.00
786.00 (86)
129.00
Nil
1,740.00
Nil
1,740.00
1,740.00
424.10 (24)
1,315.90
Bagalkot
615.00
Nil
615.00
Nil
615.00
419.00 (68)
196.00
Kodagu
165.00
Nil
165.00
Nil
165.00
105.00 (64)
60.00
Tumkur
1,005.00
2,300.00
1,005.00
2,300.00
3,305.00
724.28 (22)
2,580.72
600.00
884.00
600.00
884.00
1,484.00
772.42 (52)
711.58
4,125.00
5,874.00
4,125.00
5,874.00
9,999.00
4,532.01(45)
5,466.99
Bidar
Shimoga
TOTAL
Funds
released were
deposited in
banks to
avoid lapse
Test-check revealed that the funds were released only during the end of 200607 and were deposited in banks to avoid lapse of grants. The utilisation of
funds ranged from 22 to 86 per cent indicating slow progress of work even
after eighteen months of commencement of the programme.
14
Swacha Grama Yojana - Rs.72.96 crore, Kugrama-Sugrama - Rs.6.15 crore, Rajiv Gandhi
Housing Corporation Ltd.- Rs.25 crore
28
Chapter II – Results of Audit
2.1.7.2
There were
inconsistencies in
release of funds
by the district
level officers to
executing
agencies
Scheme envisaged release of funds to PRED through treasury on completion
of work and to KLAC and Nirmithi Kendra through banks. However, audit
scrutiny revealed that in the test-checked districts, there were inconsistencies
in release of funds by the District level Officers as four Officers released the
funds to GPs, one to Taluk Panchayat (TP) and the rest directly to the
executing agencies for implementation of the Scheme in order to avoid lapse
of grants. The funds released to GPs/TPs were returned and released to the
executing agencies subsequently.
2.1.7.3
There were
variations in
approval of works
and allocation of
funds
ZPs test-checked
Bangalore (Rural)
Inconsistencies in release of funds by ZPs
Approval of works and allocations was not need based
Scrutiny of development plans prepared by the NGOs in the test-checked
villages with reference to approved Actions Plans revealed that there were
variations in approval of works and allocation of funds as detailed below:
(Rupees in lakh)
Development Plans prepared by GOs
sector programmes
under the Scheme
(convergence programme)
o. of
Amount
o. of works
Amount
works
102
896.52
216
2,037.38
Approved Action Plans
sector programmes
under the Scheme
(convergence programme)
o. of
Amount
o. of works
Amount
works
95
832.50
61
352.42
Chamarajanagar
108
1,867.13
269
4,954.27
107
1,311.41
146
4,418.12
Mandya
104
1,212.49
286
3,857.06
102
1,190.65
275
5,077.75
Bidar
165
1,393.18
332
4,846.94
109
1,101.56
219
6,104.38
Bagalkot
140
2,036.45
407
9,484.08
143
1,668.99
305
11,754.94
Kodagu
35
462.00
99
1,009.86
38
574.54
59
447.50
Tumkur
116
1,652.31
344
4,018.85
118
1,522.44
169
2,155.66
Shimoga
37
476.42
100
2,248.99
35
362.45
118
2,795.79
TOTAL
807
9,996.50
2,053
32,457.43
747
8,564.54
1,352
33,106.56
It was observed that allocation of funds to a village under the Scheme was
based on the percentage of rural population of the village to that of taluk and
State rural population and not as per the actual requirement envisaged in the
development plan. This resulted in non-inclusion of some of the works in
Action Plans although they were included in the development plans. In
respect of the convergence programmes, it was seen that separate convergence
plans were not prepared by the line departments. However, some of the works
approved under convergence programme were also included regularly in the
AAPs of the line departments for sector programmes.
29
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.1.7.4
Huge shortfall in
allocation of
funds under
sector
programmes for
developmental
works
Convergence schemes were not as envisaged
The Scheme guidelines envisaged that in addition to the fund of Rupees One
crore earmarked directly under the Scheme, various line departments, ZPs,
TPs and GPs implementing the sector programmes had to allocate funds for an
average estimated cost of Rs.2.29 crore per village. Inclusion of the activities
to be undertaken in the selected villages by the line departments in their
regular action plan as a convergence programme and directions for
implementation of these works on priority basis resulted in infringement of
functions of GPs. Consequently, two GPs15 have filed writ appeals in the
Hon’ble High Court of Karnataka challenging the Scheme guidelines. Further,
a comparison of the convergence programmes approved by ZPs for the
Scheme and the regular action plans of the line departments revealed that there
was huge shortfall ranging from 61 to 96 per cent in allocation of funds in the
test-checked ZPs as detailed below:
(Rupees in lakh)
ZPs test-checked
Bangalore (Rural)
Funds allocated in
the Action Plan of
line Departments
138.87
Shortfall
Percentage
of shortfall
213.55
61
Chamarajanagar
4,418.12
229.76
4,188.36
95
Mandya
5,077.75
242.60
4,835.15
95
Bidar
6,104.38
663.03
5,441.35
89
11,754.94
426.41
11,328.53
96
Kodagu
447.50
62.49
385.01
86
Tumkur
2,155.66
240.94
1,914.72
89
Shimoga
2,795.79
143.99
2,651.80
95
33,106.56
2,148.09
30,958.47
93
Bagalkot
TOTAL
2.1.7.5
onagricultural
employment
opportunities
were not
provided
Approved Action Plan
under convergence
programme
352.42
Avenues for non-agricultural employment
In order to prevent over dependence on agriculture-based occupations, the
scheme provided for generation of employment in non-agricultural activities
such as manufacturing of garments, furniture, electrical and electronic goods,
food processing, etc. Though provision of infrastructure and intensive training
for such activities had to be borne out of the Swarnajayanti Gram Swarozgar
Yojana scheme under convergence programme, it was observed that no such
allocation was made in the AAPs of the test-checked ZPs, thereby defeating
the objective of building up a vibrant village community.
15
Aloor and Hebri
30
Chapter II – Results of Audit
2.1.8
Programme implementation
2.1.8.1 The details of physical and financial progress of implementation of
the works under the Scheme in the State and test-checked ZPs as of March
2008 were as follows:
State level:
(Rupees in crore)
umber
of works
Estimated
Amount
Fund
released
Expenditure
umber of
works
completed
umber of
works in
progress
umber of
works not
commenced
3,488*
771.12
458.84
200.37
569
1,203
1,716
*Roads, drains, anganwadi and community centers
Source: RDPR progress report
Test-checked ZPs:
ZPs
umber of
work
components
Estimated
Amount
Fund
released
Expenditure
(Rupees in crore)
Bangalore (Rural)
umber of
work
components
completed
umber of
work
components
in progress
umber of
work
components
not
commenced
Nil
92
15.63
8.40
5.02
9
83
Chamarajanagar
182
23.20
9.35
8.00
Nil
67
115
Mandya
178
41.90
9.15
7.86
Nil
100
78
49
27.91
17.40
4.24
Nil
46
3
1,936
33.71
6.15
4.19
175
181
1,580
Bidar
Bagalkot
Kodagu
242
7.79
1.65
1.05
Nil
Nil
242
Tumkur
3,081
65.05
33.05
7.24
Nil
Nil
3,081
Shimoga
180
29.10
14.84
7.72
Nil
180
Nil
TOTAL
5,940
244.29
99.99
45.32
184
657
5,099
Audit observed that the developmental works were entrusted only during
December 2007/January 2008 thereby delaying the completion of works
which in turn defeated the objective of development of one thousand villages
every year.
2.1.8.2
Developmental
works were not
prioritised to
upgrade the
physical
environment
3on-prioritisation of developmental works
As envisaged in the guidelines, the development of infrastructure like roads
and drains while being universally popular would be of limited consequence in
improving the quality of life in the villages without adequate coverage of
sanitation. The Scheme guidelines provided for development of roads and
drains to be taken up only after completion of total sanitation and shifting of
manure pits outside the village.
In test-checked 106 villages, road works costing Rs.39.25 crore were in
progress without attending to total sanitation and shifting of manure pits.
31
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Scrutiny also revealed that out of the test-checked ZPs, a sum of Rs.1.35 crore
had been released (February 2007) to 45 GPs only in Bagalkot district for
acquiring suitable site for shifting the manure pits. However, the funds were
lying with GPs as sites were not available at the allocated amount. This
indicated lack of realistic approach in allocation for the said activity.
2.1.8.3
Training in
computers was
not imparted
3on-commencement of training
Development of training facilities is an urgent need in the villages to enable
educated/literate youth to secure employment in various growing sectors of the
economy. The Scheme provided for training in the use of computers and in
skills required for the manufacturing and service sectors. Even though
Rs.137.82 lakh was released (September 2007) to 19 ZPs with a stipulation to
commence the training during October 2007 by the entrusted agency
(RUDSETI), the ZPs released funds to the agency only during December 2007
to March 2008. While the necessary infrastructure was procured (January
2008) for Rs.7.25 lakh in one of the test-checked ZPs, the same was not
procured in the other ZPs by the agency till March 2008. Memorandum of
Understanding did not indicate any time frame for providing infrastructure and
commencement of training by the agency. It was further noticed in the testchecked ZPs that no training was imparted to the beneficiaries (March 2008)
thereby denying benefits to the educated unemployed.
2.1.9
2.1.9.1
Other points of interest
Entrustment of work without administrative approval
Chief Executive Officer, ZP, Chamarajanagar released (October 2007) Rs.44
lakh to PRED, Chamarajanagar and entrusted (December 2007) six road
works estimated to cost Rs.406.44 lakh without according the administrative
approval for these works. Expenditure of Rs.16.30 lakh was incurred out of
the releases (May 2008). Releases by the district level officer to the executing
agency without approval were irregular and in violation of the codal
provisions.
2.1.9.2
Operation of two bank accounts
Out of the grant of Rs.3.82 crore released to Executive Officer (EO), TP, Sira,
Rs.10 lakh was deposited in a separate bank account in violation of the State
Government circular on operation of a single bank account for a scheme.
Similarly, EO, TP, Pavagada deposited Rs.1.25 crore in various banks during
March 2008.
32
Chapter II – Results of Audit
2.1.10 Monitoring and evaluation
At the State level, a HLC was to give policy direction, approve overall outlays
and review the progress of the programme. It was observed that the
committee had conducted only one meeting in January 2007, resulting in no
review of the progress in programme implementation. Recommendation of
the HLC for creation of post of a Senior Shirestedar at the village level to
monitor implementation of the Scheme was also not considered by State
Government indicating absence of monitoring.
Scheme guidelines also envisaged evaluation of the Scheme by external
agencies which were not carried out in any of the test-checked districts.
2.1.11 Conclusion
Review on the implementation of the Suvarna Gramodaya Yojana revealed
that the Scheme guidelines did not spell out explicitly the criteria for selection
of villages. While there were delays in approval of action plans, the approved
action plans were not consistent with the actual necessities of the rural
population.
The financial management was poor in view of large scale diversion and
blocking up of funds in bank accounts. No expenditure was incurred on
developmental works under the Scheme during 2006-07 and the shortfall in
utilisation of funds ranged from 22 to 86 per cent as of March 2008 in the ZPs
test-checked.
Integrated approach in developmental works was lacking as funds under
convergence programme were not properly allocated by the line departments.
Monitoring and evaluation were absent.
2.1.12 Recommendations
The perspective plan should be drawn up to identify and select the
villages in the order of priority for development.
Preparation and approval of action plans should be based on the
felt needs of the rural population.
The State Government should release adequate funds for the
Scheme and separate allocation for convergence under the sector
programmes should be made in the Budget.
Monitoring mechanism needs to be established to achieve a vibrant
village community.
33
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.2
Rural Road Works
Highlights
Connectivity to rural habitation is a key factor in promoting access to
economic and social services. This acts as a basic ingredient in effective
implementation of poverty alleviation programmes in rural areas. A review
of implementation of schemes for rural road works revealed that the
schemes suffered due to defective annual action plans, execution of
unprioritised works, substandard works, etc.
District Rural Road Plans were not updated periodically and priority list
for development of rural roads was not prepared.
(Paragraph 2.2.7.1)
Annual Action Plans were deficient and 612 road works included in
Annual Action Plans were not traced to District Rural Road Plans.
(Paragraph 2.2.7.2)
Funds amounting to Rs.7.15 crore was diverted from Mukya Mantri
Grameena Rasthe Abhivridhi Yojana for payment of daily wage
employees.
(Paragraph 2.2.8.2)
Execution of road works in disregard of specifications of Rural Roads
Manual rendered 86 works costing Rs.98.80 lakh substandard.
(Paragraph 2.2.9.7)
Quality control test and monitoring of rural road works were inadequate.
(Paragraphs 2.2.12.1 and 2.2.12.2)
2.2.1
Introduction
All Weather Road16 (AWR) connectivity to rural habitations is a key factor in
promoting access to economic and social services. This acts as a basic
ingredient in effective implementation of poverty alleviation programmes in
rural areas. The Zilla Panchayats (ZPs) are responsible for improvement and
maintenance of rural roads through Panchayat Raj Engineering Divisions
(PREDs).
16
An all weather road is a Black Topped (BT) or Water Bound Macadam (WBM) road with
adequate cross drainage facility, which is negotiable in all seasons of the year
34
Chapter II – Results of Audit
2.2.2
Organisational structure
The organisational set-up in the State for implementation of rural road
schemes was as under:
Organisation/Agency
Rural Development and Panchayat Raj
(RDPR) Department
Responsibility
According administrative sanctions for Rural
Infrastructure Development Fund (RIDF)
works; submission of budget proposals to
Finance Department; releasing budgeted grants
to ZPs; supervision of the progress of works.
Chief Executive Officer, ZPs
Monitoring the release of funds to PREDs,
scrutinising annual action plans of districts,
according administrative approval to rural road
works other than RIDF works, approval to
District Rural Road Plan (DRRP) and Core
Network.
Chief Engineer (CE), Panchayat Raj
Engineering (PRE) Department
According technical sanctions, monitoring of
physical and financial progress and quality of
works.
Executive Engineers (EEs) of PREDs
Preparation of annual action plans and
execution of works, preparation and updating of
DRRP and Core Network.
District Level Road Development
Committee/Standing Committee of the
ZP
Selection of projects based on proposals
submitted by PREDs; monitoring at the district
level.
Karnataka Rural Road Development
Agency (KRRDA)
Scrutiny of DRRP and Core Network and
maintenance of relevant database
2.2.3
Programme objectives
Rural Roads Manual (Manual) provided for adoption of an integrated
approach for implementation of a common development plan so as to avoid
fragmented approach in planning of various schemes. The manual also
provided for execution of rural road works based on DRRP supported by Core
Network17 and a priority list for systematic development of rural roads. AWR
connectivity to habitations was to be provided at a minimum cost to meet the
travel needs of rural population to market place, education, health centres and
public buildings.
2.2.3.1 As of March 2008, the total length of rural roads in the State for
providing inter-connectivity to the habitations under the control of ZPs was as
follows:
17
Core Network consists of essential through routes and link routes
35
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
[Length in Kilometers (kms)]
Sl.o.
Category of roads
Length of rural
roads under Core
etwork zone
Length of rural
roads other than
Core etwork
zone
Total length of rural
roads
1
BT roads
25,511
13,883
39,394
2
WBM roads
13,578
11,152
24,730
3
Gravel roads
25,133
2,497
27,630
4
Track roads
3,286
52,172
55,458
TOTAL
67,508
Source: Data compiled by KRRDA
79,704
1,47,212
Out of the total length of 1.47 lakh kms of rural roads, 0.68 lakh kms belonged
to Core Network which provided optimal network link to each habitation. The
improvement and maintenance of rural roads other than internal village roads
were met out of the ZP funds/grants under schemes such as Pradhan Manthri
Gram Sadak Yojana (PMGSY), Mukya Mantri Grameena Rasthe Abhivridhi
Yojana (CMGSY), Twelfth Finance Commission (TFC) grants, National Bank
for Agriculture and Rural Development (NABARD) assisted RIDF and State
plan scheme18.
2.2.4
Scope of audit and methodology
Audit reviewed (June to December 2008) implementation of schemes for rural
road works (except PMGSY) during the period 2003-08 by test-check of
records of the Secretary, RDPR Department, CE, PRE Department, 11
PREDs19 of eights selected districts20 comprising 56 taluks21 and KRRDA
based on simple random sampling method. Two taluks in each of the selected
districts were chosen at random for the study of road network pattern. Out of
the total expenditure of Rs.881.22 crore incurred during 2003-08 on
improvements and maintenance of rural road works in the State under the
schemes covered for performance review, an expenditure of Rs.299.93 crore
(34 per cent) was test-checked. The audit objectives based on the programme
objectives and the criteria adopted were discussed (December 2008) with the
Secretary, RDPR department. The Exit Conference was held on 23 March
2009 with the Secretary and other officers of RDPR Department. The
Director and Ex-officio Joint Secretary to Government of Karnataka, RDPR
Department, generally accepted the audit findings and stated (March 2009)
that detailed replies for the draft performance review would be furnished in
due course.
18
Under Head of Account 5054 – Capital outlay on Roads and Bridges
Bellary, Bijapur, Channarayapatna, Chikmagalur, Gadag, Gulbarga, Hassan, Mandya,
Sagar, Shimoga and Yadgir
20
Bellary, Bijapur, Chikmagalur, Gadag, Gulbarga, Hassan, Mandya and Shimoga
21
Referred as ‘blocks’ in DRRP and Core Network
19
36
Chapter II – Results of Audit
2.2.5
Audit objectives
The audit objectives for the performance review were as follows:
To ascertain whether planning process was in conformity with the
programme objectives
To examine adequacy of funds and its utilisation for the purpose
To verify whether the execution of rural road works including
maintenance and renewals were economical, efficient and effective
To ensure that quality control mechanism and monitoring system
were in place.
2.2.6
Audit criteria
The audit criteria adopted for the performance review were:
Rural Roads Manual published by the Indian Road Congress (IRC)
Guidelines issued for PMGSY, CMGSY, TFC, NABARD assisted
RIDF, Plan scheme of the State Government, etc.
Draft Project Reports (DPRs) and project implementation
documents for individual works
The Karnataka Transparency in Public Procurement Act, 1999 and
Rules thereunder.
Audit findings
The Audit findings are discussed in subsequent paragraphs.
2.2.7
2.2.7.1
While DRRP
was not
updated
periodically,
priority list
was also not
prepared
Planning
Selection of road works
Under the Manual and PMGSY guidelines for providing an AWR link to each
habitation, a DRRP had to be prepared to serve as complete inventory of all
existing rural roads and their status along with Core Network by conducting
field survey supplemented by secondary sources such as period-wise database
of works executed under different schemes. Besides, a priority list for the next
5 to 10 years was also to be prepared. The DRRP was to be revised/updated
periodically atleast once in two years.
Test-check of records of 16 taluks in the districts test-checked revealed the
following deficiencies:
37
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
The DRRPs prepared during 2002-03 was updated only during 2006-07
resulting in lack of updated database on the status of rural roads for
effective planning on improvement and maintenance during the
intervening period (2003-06).
Cross reference to the road code assigned to each road in the DRRP was
not indicated in the relevant Core Network in any of the test-checked
taluks, indicating deficiency in preparation of Core Network data.
Priority list was not prepared in any of the test-checked taluks. Failure to
do so resulted in execution of road works not listed in the DRRP as
detailed in paragraph 2.2.7.2.
Guidelines issued by State Government stipulated that WBM and BT
roads were to be designed for a life-span of 10 years and were to be remetalled/re-asphalted once in three/six years respectively. Audit observed
that period-wise database of works executed under different schemes was
not maintained. In the absence of proper data base, audit could not
ascertain whether roads were re-metalled/re-asphalted within three/six
years of its construction.
In the absence of details of road data in AAPs which were to serve as
secondary source of data, approved DRRPs were prone to manipulation.
It was evident from the fact that in Mandya district, the road data
indicated in the DRRP differed from that of DPR for work executed as
detailed below:
Details of
work
executed
Improvement
of road
from MM
road
to
Mallenahalli
2.2.7.2
Scheme and
period of
execution
RIDF – X
2006-07
Road data as
per DRRP of
2006
Road data
mentioned in
DPR
Audit findings/Reply
1.50 km of
WBM road
1.50 km of
earthen road
and proposed
for
conversion to
BT
Expenditure of Rs.8.07 lakh incurred
for conversion from earthen road to
WBM road was doubtful.
EE,
PRED, Mandya stated that there was
an error in DRRP due to oversight
and will be corrected.
Annual Action Plans
Under the established procedure in Panchayat Raj system, the State
Government was to make taluk-wise allocation from available scheme funds.
Based on the funds allocated, the PREDs were to prepare scheme-wise AAPs
conforming to scheme guidelines and prioritising the requirements. The
Standing Committee of the ZPs concerned was to approve such AAPs. The
irregularities noticed in the preparation of AAPs were as follows:
38
Chapter II – Results of Audit
AAPs did not
specify nature
of road
improvement
required for
execution
Road works as
per AAPs could
not be traced to
DRRPs
Scheme guidelines prescribed norms/ratio to be maintained during
preparation of AAPs towards construction/improvement and maintenance
of road works. The AAPs were to be prepared by fixing clear cut targets
towards conversion of each category of road into AWRs. AAPs with full
details were to serve as a secondary source of data. Contrarily, test-check
revealed that AAPs prepared and approved during 2003-08 merely
indicated improvement works without specifying the nature of
improvement required. Deficiencies in preparation of AAPs, thus, led to
absence of secondary source of data.
Road code as assigned to each road in the DRRP along with its existing
status, age and Pavement Condition Index22 (PCI) value was to be clearly
indicated in the AAP in respect of each improvement/maintenance and
renewal work taken up under the schemes. This vital information was
lacking in the AAPs of the rural road schemes.
Audit could not trace 601 works23 costing Rs.14.08 crore out of 2,833
cases test-checked in 16 taluks in the approved AAPs against those
specified in the DRRPs for the period 2003-08.
Out of 51 rural road improvement works in three test-checked districts
executed by Public Works Department (PWD) under RIDF VIII to X
schemes during the period 2003-08, 11 works24 costing Rs.6.03 crore
could not be traced to relevant DRRPs.
In Bellary district, 14 works which were not included in the AAPs under
TFC were executed during 2007-08 incurring an expenditure of Rs.54.78
lakh.
2.2.8
2.2.8.1
Financial management
Fund position
The funding for all rural road schemes was routed through budgetary
allocations including that of NABARD assisted RIDF scheme. The details of
releases and expenditure in the State under different schemes during 2003-08
were as follows:
22
PCI value indicates surface condition of the road
Bellary – 25, Bhadravathi – 27, Bijapur – 12, Channarayapatna – 25, Chikmagalur -67,
Gadag – 13, Gulbarga -37, Hassan -61, Hospet – 26, Malavalli – 15, Mandya -49,
Mudigere – 100, Ron -21, Sagar – 46, Sindagi – 15 and Yadgir- 62
24
Chikmagalur-6, Mandya-1, Shimoga-4
23
39
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
(Rupees in crore)
Year
Scheme
TFC Grants
R
E
Nil
Nil
2003-04
CMGSY/3054
R
E
75.55
33.44
5054
R
E
19.15
12.65
2004-05
98.07
22.07
2005-06
111.98
62.90
22.24
18.33
Nil
Nil
2006-07
183.29
150.13
22.45
19.49
86.87
63.73
Series
RIDF
R
E
VIII
89.34
81.66
IX
52.05
43.63
2007-08
188.41 160.26
44.60
37.04 86.86*
84.99
X
TOTAL
657.30 487.39 130.51 101.47 173.73 148.72
Source: Details as furnished by the Accounts wing of CE, PRE Department
R - Releases, E - Expenditure
* - Second instalment of TFC grants for 2006-07 released during 2007-08
23.47
164.86
18.35
143.64
80.66
13.96
Nil
Nil
As against the total releases of Rs.1,126.40 crore, an expenditure of Rs.881.22
crore was incurred in the State on road works executed under various schemes.
Audit noticed discrepancies between the expenditure figures booked in the
Accounts wing and progress reports compiled by the Technical wing of the
office of CE, PRE Department, which is commented separately in paragraph
2.2.12.2.
The scheme-wise financial position in the test-checked districts during the
period 2003-08, as furnished by the Accounts wing of the CE, PRE
Department is detailed in Appendix 2.2.
2.2.8.2
Diversion of
CMGSY
scheme funds
amounting to
Rs.7.15 crore
Diversion of funds
It was observed in audit that PREDs made payment of Rs.7.15 crore out of
maintenance grants of CMGSY funds during 2004-05 to daily wage
employees engaged in ZP activities, based on the instructions of the State
Government. This resulted in diversion of scheme funds besides curtailment
of allocated funds for maintenance of rural roads. The instruction of the State
Government was, thus, irregular. Details of payment of daily wages during
subsequent years were not compiled and furnished by the Department.
2.2.9
Execution of works
2.2.9.1 Improvement of rural roads to a length of 7,821 kms costing
Rs.367.04 crore and maintenance of rural roads to a length of 24,152 kms
costing Rs.320.17 crore was carried out in the State during 2003-08 under
different schemes as detailed below. Similarly, the test-checked districts
incurred expenditure of Rs.122.16 crore and Rs.87.69 crore on improvement
and maintenance of roads respectively during 2003-08.
40
Chapter II – Results of Audit
State level
Schemes
Physical
(in kms.)
Financial
(Rupees in crore)
Test-checked districts
Physical
Financial
(in kms.)
(Rupees in crore)
Improvement works
RIDF
1,830
143.64
674
48.78
CMGSY/3054
3,656
106.87
905
36.70
5054-R & B
1,432
88.52
368
24.91
903
28.01
418
11.77
7,821
367.04
2,365
122.16
21,418
280.65
7,251
79.84
2,734
39.52
429
7.85
TFC
TOTAL
Maintenance works
CMGSY/3054
TFC
TOTAL
24,152
320.17
7,680
87.69
Source: Progress report of works maintained by Technical wing of CE, PRE Department
R & B - Roads and bridges
Note : Maintenance works were not taken up under RIDF and Head of account 5054
Under RIDF scheme
2.2.9.2
Physical and financial achievement
The NABARD assisted RIDF works were approved by the Cabinet SubCommittee of the State Government based on proposals received from the
PREDs and executed through tender system. The State Government provided
funds to ZPs initially as per the AAPs and later claimed reimbursement of
expenditure by way of loan from NABARD. The physical and financial
progress of RIDF works in the State and test-checked districts during 2003-08
were as below:
Sl.
o.
1
2
3
4
5
6
7
8
RIDF series
VIII to X
umber
of works
taken up
Road
length
(in kms)
Contract amount
(Rupees in crore)
umber
of works
completed
umber of
works in
progress
Expenditure
(Rupees in crore)
In the State
751
1,830
151.57
675
76
143.64
Bellary
23
69
5.99
20
3
5.74
Bijapur
18
61
3.97
16
2
3.89
Chikmagalur
46
95
7.13
44
2
6.72
Gadag
20
67
6.30
20
Nil
6.20
Gulbarga
27
97
6.82
23
4
6.43
Hassan
54
121
9.47
40
14
8.57
Mandya
25
66
5.52
19
6
4.79
Shimoga
42
98
6.72
40
2
6.44
TOTAL
255
674
51.92
222
33
48.78
Source: Progress report of work maintained by Technical wing of CE, PRE Department
Out of 33 incomplete works in the test-checked districts, 12 works25 related to
RIDF–X series which were commenced during 2006-07 and were under
various stages of completion. Irregularities observed from the review of
works records in the test-checked divisions are detailed in subsequent
paragraphs.
25
Mandya -6, Bellary-1, Bijapur -2, Chikmagalur -1, and Gulbarga -2
41
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.2.9.3
Action of the EE
in entrusting
additional works
without ensuring
progress of works
entrusted earlier
resulted in
rescinding the
contracts and
consequent cost
escalation
The EE, PRED, Hassan entrusted (July and September 2003) four RIDF works
at a total estimated cost of Rs.45 lakh to a contractor. No performance
guarantee was obtained from the contractor. Despite tardy progress by the
contractor in respect of the works already awarded, the EE entrusted three
more works to the same contractor between December 2003 and February
2005. Inability of the contractor to show sufficient progress, resulted in all the
seven works being rescinded (March–September 2006) at the risk and cost of
the contractor. Extra cost of Rs.54 lakh was estimated (March 2008) due to
cost escalation on re-tendering of five of the above works and tenders in
respect of remaining two works were yet to be finalised (March 2009). As of
March 2009, an expenditure of Rs.40.07 lakh was incurred on these works.
Entrustment of additional works to the same contractor without ensuring
progress in respect of works already entrusted was, thus, injudicious. No
action had been initiated by the division to forfeit the Earnest Money Deposit
and Security Deposit of the contractor (March 2009).
2.2.9.4
on-enforcement
of penalty clause
led to non/short
levy of Rs.16.05
lakh
Injudicious entrustment of works to a contractor
3on/short levy of penalty for delayed completion of work
According to clause 2(d) of conditions of contract, penalty of an amount equal
to one per cent of the estimated cost of balance work remained incomplete for
the days of delay but not exceeding 7.5 per cent of the estimated cost of the
entire work was to be levied on the contractor. It was, however, observed in
PRED, Channarayapatna that in six cases no penalty was levied though there
were delays ranging between 441 to 940 days in completion of entrusted
works. A nominal penalty was levied in seven cases of other three divisions26
though the delay ranged from 172 to 790 days and delay was solely attributed
to the contractors. This resulted in non/short levy of penalty of Rs.16.05 lakh
on the above works (Appendix 2.3).
2.2.9.5 Gravel utilised in excess of requirement
Manual stipulated that the quantity of gravel to be used as binding material
over grade-II and grade-III metal were to be one-fourth of the metal provided.
However, it was noticed in respect of two road works27 executed during
January/July 2004 under two divisions that as against the requirement of 2,321
cum of gravel (as worked out by audit), 8,666 cum was utilised resulting in
utilisation of excess quantity of 6,345 cum of gravel costing Rs.8.51 lakh. No
specific reasons were furnished by the divisions.
26
Chikmagalur-3, Sagar-2 and Shimoga-2
Pettalur-Hallikeri road in Mundaragi taluk of Gadag district and SabbanahalliChikkamulagudu road in Maddur taluk of Mandya district
27
42
Chapter II – Results of Audit
2.2.9.6 Execution of stretch of a road without sub-base
Additional length
of 1.15 km was
executed without
providing the
required sub-base
Under RIDF-VIII scheme, the work of improvement of road from KarwarBellary (NH-63) to Asundi-Kurthakoti-Mulagund in Gadag taluk for a length
of 18 kms (chainage - 1.00 to 19.00 km) was taken up (December 2003) and
completed (March 2006) at a cost of Rs.2.05 crore. Further, a separate extra
items rate list (EIRL) was prepared by the EE, PRED, Gadag for an additional
length of 1.15 km to provide connectivity up to 20.15 km, as this was not
reckoned during preparation of original estimate. Scrutiny of the records
relating to the work revealed that the EIRL for the additional length included
only the items relating to providing of metal and mix seal surface leaving out
the essential items such as earth work, formation of sub-grade and sub-base,
etc. In the absence of execution of these items, the expenditure of Rs.11.69
lakh incurred on the stretch of road (19.00 to 20.15 km) could not be
vouchsafed in audit.
Under other schemes
2.2.9.7 Execution of substandard works
Execution of substandard works
costing Rs.98.80
lakh were prone
to premature
failures
Manual provided for construction of WBM base course with grade II and
grade III metal layers of compacted thickness of 75 mm each with grade III
metal laid at the top surface for WBM AWR. Test-check of sanctioned
estimates and Running Account bills in six divisions28 revealed that 86 works
costing Rs.98.80 lakh were executed (2005-08) providing only grade-II metal
layer of 75 mm compacted thickness without laying the required grade-III
layer. Evidently, these works were of substandard quality and prone to
premature failures and the expenditure on these works may become wasteful.
The EEs of the concerned divisions stated (October 2008) that the matter
would be examined.
2.2.9.8 Unfruitful expenditure on construction of a bridge
The work of construction of a bridge at Alekhan-Horatti village in Mudigere
taluk of Chikmagalur district was completed (February 2007) at a cost of
Rs.4.85 lakh. Scrutiny of records revealed that the estimate did not provide
for approach roads to the bridge. The EE, PRED, Chikmagalur stated (March
2009) that the approach road was not constructed due to paucity of funds and
would be completed utilising funds from other schemes. Failure of the EE,
PRED, Chikmagalur in preparing a comprehensive estimate rendered the
expenditure of Rs.4.85 lakh on construction of the bridge unfruitful besides
depriving the villagers of the envisaged connectivity.
28
Bellary-11, Channarayapatna-56, Gadag-4, Gulbarga-4, Shimoga-8 and Yadgir-3
43
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.2.10 Maintenance of roads
The guidelines provided for maintenance and periodical renewal of surfaces of
WBM and BT roads once in three and six years respectively.
2.2.10.1 The physical and financial progress under maintenance and renewal
works during 2003-08 in the State, as compiled by the Technical wing of the
CE, PRE Department, were as follows:
(Rupees in crore)
Year
2004-05
Maintenance
Physical
Financial
(kms)
ame of
Scheme
CMGSY
2007-08
16.16
2,085
57.35
6,125
73.51
3,338
33.03
806
25.85
4,144
58.88
TFC grants
1,396
12.94
1,339
26.58
2,734
39.52
CMGSY
5,963
42.34
5,186
105.92
11,149
148.26
14,737
104.47
9,416
215.70
24,152
320.17
*
TOTAL
*
Total
Physical
Financial
(kms)
4,040
CMGSY
2006-07
Periodical Renewals
Physical
Financial
(kms)
No amount was released during 2007-08
Of the existing 64,124 kms of BT and WBM roads in the State,
maintenance/periodical renewals were taken up only for a length of 24,152
kms (38 per cent) during 2004-08 indicating inadequate attention in the
matter. No expenditure was incurred on maintenance/renewals under CMGSY
during 2005-06. The details of maintenance/periodical renewals taken up in
the test-checked districts were as follows.
(Rupees in crore)
2004-05
ame of
District
Scheme
CMGSY
TFC grants
CMGSY
Bijapur
TFC grants
Chikmagalur CMGSY
Gadag
CMGSY
CMGSY
Gulbarga
TFC grants
CMGSY
Hassan
TFC grants
CMGSY
Mandya
TFC grants
CMGSY
Shimoga
TFC grants
TOTAL
Bellary
Physical
(in kms)
243
214
223
160
334
200
252
258
1,884
2006-07
Financial
3.33
2.59
2.62
1.84
4.81
1.56
1.55
3.25
21.55
2007-08
Physical
(in kms)
Financial
Physical
(in kms)
121
43
140
20
107
434
127
181
102
88
36
54
45
43
1,541
2.11
0.37
2.63
0.78
2.38
2.62
2.14
1.08
1.29
1.35
3.58
2.69
1.48
1.58
26.08
120
1,358
440
157
574
1,123
275
208
4,255
Total
Financial
2.89
3.20
5.11
3.31
4.84
9.32
9.04
2.35
40.06
Physical
(in kms)
Financial
527
8.70
1,732
9.20
770
751
10.11
7.77
1,216
12.87
1,513
13.52
617
16.86
554
8.66
7,680
87.69
Source: Progress report of work maintained by Technical wing of CE, PRE Department
Maintenance/renewal works were not carried out during 2005-06 in the testchecked districts in the absence of specific guidelines. Separate data
pertaining to maintenance/renewal of roads identified under Core Network
were not maintained either at the State level or in the test-checked divisions.
44
Chapter II – Results of Audit
2.2.10.2
Damaged roads
The condition of a road was to be determined based on the PCI value. While
the roads with PCI value of three and above were generally considered as
good, less than three indicated necessity of improvement/renewal. Scrutiny of
DRRPs of the test-checked taluks disclosed that 67 per cent of the existing
roads had PCI value less than three and required immediate repairs.
The taluk-wise details are as shown in the table below.
Sl.
o.
District
1
Bellary
2
Bijapur
3
Chikmagalur
4
Gadag
5
Gulbarga
6
Hassan
7
Mandya
8
Shimoga
Taluk
Bellary
Hospet
Bijapur
Sindagi
Chikmagalur
Mudigere
Gadag
Ron
Gulbarga
Yadgir
Hassan
Channarayapatna
Mandya
Malavalli
Bhadravathi
Sagar
TOTAL
Total number
of roads
196
100
266
256
332
191
177
198
327
163
252
286
274
365
290
340
4,013
Roads with
PCI below 3
170
47
214
148
285
191
160
197
300
126
Not indicated in DRRP
240
126
167
144
160
2,675
Status of road from BH Road to Tippalapura in Bhadravathi taluk
45
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.2.11
Other points of interest
Joint inspections conducted by audit along with the departmental staff during
the course of review revealed the following interesting points:
The work of improvement to Chikkakondagula-Chittanahalli road in
Hassan taluk under RIDF IX scheme estimated to cost Rs.1.57 crore
though commenced in September 2006 remained incomplete
(March
2008) even after a lapse of one year from the scheduled date of completion
due to non-shifting of an electric pole located at the beginning stretch of
the road obstructing vehicular movement. Audit observed that the PRED,
Hassan failed to make provision for shifting of electric pole in the
sanctioned estimate of the work and the matter was taken up with the
electricity authority as late as in November 2008. The estimate for Rs.
0.49 lakh was assessed (February 2009) by the electricity authority and the
work remained incomplete for want of funds (March 2009). Thus, the
road work on which an expenditure of Rs.78.58 lakh had been incurred
remained incomplete.
Encroachment of part of the road-way width by the local farmers erecting
fences along the road considerably narrowing the road width was observed
at Nandipura-Meerajakere-Bidkal road in Mudigere taluk of Chikmagalur
district. Improvements to the road were carried out under RIDF IX
scheme at a cost of Rs.14.33 lakh (September 2005).
Improvement to road from KR Pete-Mandagere to join HN Pura road via
Kodihalli in HN Pura taluk under RIDF VIII scheme (Phase II) was
completed (August 2006) at a cost of Rs.23.30 lakh. Even before the
expiry of validity period of performance guarantee, a portion of the road
was badly damaged.
2.2.12
Quality Control and Monitoring
2.2.12.1 3on-conduct of quality control tests
While quality
control tests were
not conducted,
monitoring was
inadequate
Guidelines issued by State Government envisaged conduct of quality test of
the road development works on par with PMGSY guidelines. It was observed
in audit that the envisaged quality tests were not conducted in respect of
materials (such as gravel, base/wearing course materials, etc.) utilised on
works entrusted on piece-work contracts (works costing less than Rs.five
lakh) in any of the PREDs test-checked, except PRED, Sagar.
2.2.12.2 Inadequate monitoring
The details of progress of the road works (both physical and financial) were
maintained by the CE, PRE Department.
Audit, however, noticed
46
Chapter II – Results of Audit
discrepancies in the expenditure figures maintained by Accounts wing and
Technical wing relating to various schemes. The details were as shown in the
table below. There is an urgent need to reconcile the figures.
(Rupees in crore)
Scheme
As per
Accounts Wing
101.47
Head of Account – 5054
CMGSY (both improvement
487.39
and maintenance)
TFC
148.72
TOTAL
737.58
*Progress Report not compiled for the balance amount
As per
Technical Wing
88.52
Difference
12.95
387.52
99.87
67.53
543.57
81.19*
194.01
No action was initiated to prepare priority list based on DRRPs, period-wise
inventory of existing roads and data on essential Core Network roads with PCI
value indicating lack of direction for corrective action and monitoring by the
CE, PRED and State Government.
2.2.13
Conclusion
The performance audit on rural road works under the schemes selected for
review revealed that planning was defective and priority list of rural roads for
execution were not prepared. Deficiencies in preparation of AAPs were also
noticed.
Diversion of CMGSY fund for payment to daily wage employees of the
Department were noticed leading to curtailment of funds for maintenance of
road works. There were cases of extra cost, unfruitful expenditure coupled
with substandard execution of works.
While quality control tests were not conducted as envisaged, monitoring of
schemes at the State level was ineffective due to inadequacy and mismatch in
data maintenance.
2.2.14
Recommendations
The PREDs should be instructed to maintain period-wise
inventory of roads under different schemes.
DRRPs to be updated periodically considering secondary source
of data.
Priority list needs to be prepared for systematic development and
regular maintenance of rural roads.
AAPs should be approved fixing clear cut targets indicating
nature of improvement required for all rural roads.
Diversion of scheme funds should be avoided.
Quality control tests should be conducted for all works.
47
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.3
Performance appraisal on functioning
departments of Zilla Panchayat, Bellary
of
selected
Highlights
Zilla Panchayat, Bellary was implementing various developmental activities
through Taluk/Grama Panchayats, line departments and engineering
divisions. A review on functioning of selected departments of Zilla Panchayat,
Bellary during 2003-08 revealed inter alia that there were instances of
improper planning and budgeting, internal control mechanism failures in
financial management, non-achievement of intended objectives of the
developmental schemes coupled with unfruitful, wasteful expenditure, etc.
The functioning of District Planning Committee was ineffective. The
Chief Executive Officer did not obtain the plan proposals from Taluk/
Grama Panchayats. In the absence of defined needs of grass root level,
the Annual District Development Plans prepared during 2003-08 was not
in conformity with the provisions of Karnataka Panchayat Raj Act.
(Paragraph 2.3.6.1)
While irregular drawal of Rs.34.58 crore at the end of financial year and
depositing outside Government account was observed, central assistance
of Rs.6.15 crore was lost due to tardy implementation of Desert
Development Programme.
(Paragraphs 2.3.7.3 and 2.3.7.4)
The objective of providing education to all children in the age group of 614 years through implementation of various programmes like “Chinnara
Angala”, “Bridge School”, “Sanchari Shale”, etc., was not achieved.
Shortfall in enrolment, increasing trend in drop-out rate, large number of
vacancies in the posts of teachers, lack of proper infrastructure, etc., were
noticed by audit.
(Paragraphs 2.3.8.2 to 2.3.8.4)
The establishment of Primary/Community Health Centres was not in
conformity with the norms. The rural population of the district was
denied health care facilities due to large number of vacant posts of
doctors and supportive staff, non-provision of basic infrastructure,
shortfall in ante-natal check-ups/institutional deliveries, etc.
(Paragraphs 2.3.9.1 and 2.3.9.2)
48
Chapter II – Results of Audit
During 2003-08, though an expenditure of Rs.4.29 crore was incurred on
the establishment charges of Social Forestry Division, the area brought
under the green cover was only 37 hectares. Plantations/seedlings raised
at a cost of Rs.57.40 lakh were not maintained.
(Paragraphs 2.3.10.1 and 2.3.10.2)
Improper planning by Youth Services and Sports Department resulted in
wasteful expenditure of Rs.43 lakh on laying of cinder track. There was
abnormal delay in completion of stadia on which an investment of
Rs.45.04 lakh was made.
(Paragraphs 2.3.11.1 and 2.3.11.3)
Failure of the Zilla Panchayat/Panchayat Raj Engineering Division,
Bellary in obtaining prior permission from the Daroji Grama Panchayat
for drawing water from Daroji reservoir resulted in non-execution of a
water supply scheme under private-public participation.
(Paragraph 2.3.13.3)
The implementation of water supply schemes was not planned properly.
Defective estimates and improper monitoring by Executive Engineer,
Panchayat Raj Engineering Division, Huvina Hadagali had resulted in
extra expenditure of Rs.19.24 lakh.
(Paragraph 2.3.13.4)
There was delay in completion of water supply works rendering the
expenditure of Rs.12.07 crore unfruitful. Instances of execution of civil
works in private lands (Rs.15.91 lakh) and delay in completion of road
works due to paucity of funds (Rs.25.55 lakh) were also noticed.
(Paragraphs 2.3.14.1 to 2.3.14.3)
The implementation of ‘amma Bhoomi-amma Thota’ scheme suffered
due to non-utilisation of funds released by the State Government,
shortfall in coverage of landless labourers, non-distribution of acquired
land, irregular formation of sites, non-involvement of line departments,
etc.
(Paragraph 2.3.15)
2.3.1
Introduction
Zilla Panchayat (ZP), Bellary consists of seven Taluk Panchayats (TPs) and
189 Grama Panchayats (GPs) with a geographical area 8,447 sq. kms. As per
2003 census, the total population of Bellary district was 22.45 lakh of which
the rural population constituted 70 per cent.
49
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.3.2
Scope of audit and methodology
The performance appraisal on functioning of selected departments in Zilla
Panchayat, Bellary was conducted (June to September 2008) by test-check of
records of ZP, both the Panchayat Raj Engineering Divisions (PREDs), two
TPs29, nine GPs30 and five departments31. On specific request of the Rural
Development and Panchayat Raj (RDPR) Department, the implementation of
rural water supply schemes in the district was also covered.
2.3.3
Audit objectives
The audit objectives of the performance review were to assess whether:
the District Planning Committee (DPC) was constituted in the ZP and
was functioning as envisaged
the budget proposals were prepared and submitted on time by the TPs
and GPs
the funds released were utilised by ZP/line departments economically
and efficiently
the control mechanism for financial management was effective
the envisaged benefits of various developmental activities
implemented through PREDs/line departments were reaching the
targeted population
the human resources were adequate and its utilisation optimum
monitoring was in place.
2.3.4
Audit criteria
The Audit criteria adopted for the review were:
The Karnataka Panchayat Raj Act, 1993 (KPR Act) and
instructions issued by State Government
Guidelines/orders issued by Government of India (GOI) and State
Government for implementation of schemes/works.
29
Huvina Hadagali and Hospet
Devasamudra, Gadiganuru, Holalu, Hyarada, Ittigi, Makarabbi, M.M. Wada,
Muddapura and Mylara
31
Education, Health & Family Welfare, Khadi & Village Industries, Forest, Ecology &
Environment and Youth Services & Sports Departments
30
50
Chapter II – Results of Audit
2.3.5
Acknowledgement
Audit is thankful for the co-operation extended by the officers of the
ZP/TPs/GPs and the departments test-checked in conducting the review. The
Entry Conference of the performance appraisal was held during June 2008 and
the objectives of the review were discussed with the Secretary, RDPR
Department. The draft review was communicated (November 2008) to the
State Government, ZP and heads of test-checked departments and the Exit
Conference was held (January 2009) with the Chief Executive Officer (CEO),
ZP who generally accepted the observations. Specific remarks of State
Government are awaited (March 2009).
Audit findings
The audit findings are discussed in the succeeding paragraphs.
2.3.6
2.3.6.1
Planning process
Ineffective functioning of District Planning Committee and nonpreparation of envisaged Annual District Development Plan
The KPR Act made it mandatory for the State to constitute a District Planning
Committee (DPC) in each district which was expected to consolidate the plans
prepared by the local bodies, both rural and urban in the district and develop a
draft development plan. The primary responsibility of the DPC was, inter
alia, to integrate the plans prepared by the Panchayat Raj Institutions (PRIs) in
the district and to prepare an Annual District Development Plan (ADDP) for
the district duly incorporating the development plans of the TPs and GPs.
CEO of the ZP
failed to obtain
the plan
proposals from
GPs/TPs and the
ADDP was
prepared in a
routine manner
Focus of district planning has been largely an annual exercise, post budget,
mainly to allocate funds made available under district sector to
departments/projects. The State Government re-constituted (January 2002)
the DPC in the district and the Committee was to meet once in a quarter. As
against 20 meetings to be held during the period 2003-08, the Committee met
only five times (twice during the years 2003-04 and 2007-08 and once during
2004-05). Despite being commented in earlier Audit Reports, the GPs did not
forward their plan proposals to TPs for consolidation and onward transmission
to ZP. The DPC/CEO of the ZP also failed to insist for the plan proposals
from the lower tiers of the system. The Chief Planning Officer, ZP admitted
(December 2008) that the plan proposals were not received from GPs/TPs. In
the absence of defined needs of the GPs/TPs, the ADDP, prepared in a routine
manner, was not in conformity with the KPR Act.
51
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.3.6.2 The State Government constituted (April 2001) the DPC Fund
(Fund) with contributions from PRIs and urban local bodies of the district. The
Fund was to be utilised for payment of sitting fees to members,
commissioning of studies, etc. During 2003-08, it was noticed that as against
the amount of Rs.65 lakh to be collected from PRIs towards the Fund, only
Rs.14.20 lakh was collected and an amount of Rs. One lakh was utilised by the
ZP. Ineffective functioning of the DPC also led to non-utilisation of available
funds. The fund was also to be utilised for improvement in planning and the
Committee was to explore the planning avenues with the help of experts in
different fields. Evidently, non-utilisation of available funds amounted to
ineffective planning/functioning.
2.3.7
Financial management
2.3.7.1 The details of the budget proposal, allocation, receipts and
expenditure in the ZP during 2003-08 were as detailed below.
Budget
Plan
on-plan
NF
NF
Year
2003-04
Allocation
Plan
on-plan
46.42
112.96
Actual receipts
Plan
on-plan
82.87
105.99
(Rupees in crore)
Expenditure
Plan
on-plan
76.01
131.21
2004-05
65.24
129.10
51.04
113.01
110.95
117.64
108.81
120.21
2005-06
137.15
138.47
108.10
122.27
125.23
44.34
96.65
40.20
2006-07
143.05
133.72
137.26
141.95
105.30
53.33
90.02
43.10
2007-08*
163.73
179.21
131.69
189.36
133.93
61.28
130.11
56.08
558.28
382.58
501.60
390.80
TOTAL
Source: As furnished by ZP.
NF - Not furnished
* Figures for 2007-08 are provisional
Note:
The receipt and expenditure (Non-Plan) of TPs not included from 2005-06 onwards as TP
accounts were prepared separately.
Available
funds were
not utilised
in full
It could be seen from the table above that an amount of Rs.940.86 crore was
released to ZP, Bellary during the period 2003-08, of which the ZP incurred an
expenditure of Rs.892.40 crore. Under ‘Plan’ heads, while the overall savings
were more than 10 per cent, it was quite substantial (23 per cent) during 200506. During 2003-05, the expenditure under ‘Non-Plan’ exceeded the amount
actually received.
2.3.7.2
3on-preparation of budget estimates
The exercise of budget preparation gives an opportunity to review the trend of
expenditure and project the budget estimates realistically. The KPR Rules32
stipulates that GPs and TPs were to prepare their budget in three parts viz.,
Revenue, Capital and Debt & Deposit Account and forward it to ZP for
approval before 25 March every year. It was, however, noticed in the test32
Rule 27 (2) under KPR TP (Finance and Accounts Rules), 1996
Rule 35 under KPR GP (Accounts and Budget Rules), 1995
52
Chapter II – Results of Audit
checked TPs/GPs that the budget estimates were not prepared and submitted
for approval during the period under review. Instead, they prepared action
plan in a routine manner based on allocation made to them.
2.3.7.3 Irregular drawal of funds to avoid lapse of grant and depositing in
bank accounts
An amount of
Rs.34.58 crore was
irregularly drawn
and deposited
outside
Government
account
(i)
Karnataka Financial Code stipulated that no money should be drawn
from treasury unless it becomes due for payment. It was noticed that during
2005-08, funds aggregating Rs.23.35 crore (meant for implementation of
water supply schemes, rural roads, buildings, etc.) were drawn by Executive
Engineers (EEs) of PREDs and heads of departments and deposited in savings
bank accounts. During March 2008, the Chief Accounts Officer (CAO), ZP
instructed the PREDs/departments to draw unutilised funds from treasury on
payees’ receipt which were deposited in favour of the CEO, ZP in savings
bank accounts. Such transactions amounting to Rs.16.11 crore were irregular.
The CAO, ZP stated (June 2008) that the funds were received at the end of the
year and drawn on payees’ receipt as there was no action plans. Reply is not
tenable as some funds were available by August 2007. Thus, the failure of the
CEO in preparing action plans in time despite availability of funds led to
irregular drawals.
(ii)
The EEs of PREDs were permitted to issue cheques (within the limit
indicated therein) to executing agencies, out of the Letter of Credit (LOC)
authorized by the ZP. The cheques were to be issued to the agencies only after
completion of works or as per terms of contract.
Out of LOCs issued by the ZP, the EEs of PREDs irregularly issued (2005-08)
cheques in favour of banks transferring Rs.8.78 crore even though the works
remained incomplete and payments not due to executing agencies. The State
Government, in order to avoid any excess payment, had withdrawn the system
of LOC from 1 July 2007. It was noticed that an amount of Rs.4.74 crore was
unauthorisedly transferred to bank account on 28/30 June 2007 just before the
termination of LOC system. The EEs accepted that the funds were drawn
though the works were yet to be completed. It was evident that the ZP/PREDs
resorted to irregular procedure of drawal of funds at the end of the year to
avoid lapse of grants.
(iii) All payments towards execution of works were to be paid directly to
the concerned contractor/agency through a treasury cheque. Test-check of
records of the EE, PRED, Huvina Hadagali however, revealed that in 14 cases
the cheques were obtained (March 2008) in favour of the EE for an amount
aggregating Rs.2.06 crore and the same was irregularly deposited in a savings
bank account (in favour of EE). Subsequently, cheques were issued to the
53
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
contractors from the bank account. The Treasury Officer, Huvina Hadagali
also failed to follow the financial rules and irregularly issued cheques in
favour of EE, PRED. In reply, the EE stated (November 2008) that the funds
were drawn as the works were nearing completion. Drawal of funds and
parking outside Government account, in respect of incomplete works, was
irregular and fraught with the risk of misappropriation/defalcations.
(iv)
The recoveries made out of contractors’ bills towards Fixed Security
Deposit (FSD) by PREDs had to be credited to the head of account 8443-Civil
Deposits through ZP. It was, however, noticed that during 2007-08, the EE,
PRED, Huvina Hadagali irregularly obtained cheques for Rs.38.63 lakh in his
favour from treasury in respect of such recoveries and deposited in a savings
bank account. Of this, the EE, PRED withdrew an amount of Rs.2.01 lakh
irregularly on self cheques from the said bank account and remitted back the
amount within two to five days. The EE, PRED replied (November 2008) that
the recoveries were deposited in the bank as the ZP returned the cheques
forwarded by the PRED. The CAO, ZP, during Exit Conference, however,
denied such return of cheques and stated that directions would be issued to the
PRED to remit the recoveries to ZP.
2.3.7.4
Tardy
implementation
of DDP
resulted in loss
of assistance of
Rs.6.15 crore
Loss of Central assistance
Under Batch-IV of Desert Development Programme (DDP), it was proposed
(1998-99) to develop 20,000 hectares covering 40 watersheds in ZP, Bellary at
an estimated cost of Rupees Nine crore during the period 1998-2003. The
funding pattern was in the ratio of 75:25 between GOI and State Government.
Scrutiny of records relating to the DDP revealed that though the GOI extended
the project period up to 2003-04, the ZP could utilise only Rs.4.44 crore by the
end of extended period. As of November 2008, an area of 9,853 hectares (49
per cent) only was treated. Similarly, under Batch-V, the ZP proposed to
develop 11,500 hectares covering 23 watersheds at a cost of Rs.5.18 crore
during 1999-2004. The progress of works was tardy and the GOI instructed
(May 2005) the State Government to speed up the activities within the
extended period of 2005-06 failing which the Batch was to be closed. In spite
of extension of time, only 7,974 hectares (69 per cent) of the total intended
area was covered utilising Rs.3.59 crore (November 2008).
The CEO, ZP attributed (December 2008) the shortfall in achievement to
delay in selection of non-governmental organisations and formation of
watershed committees. Thus, failure of ZP in implementation of Centrally
Sponsored Scheme, despite extension of time from GOI resulted in loss of
central assistance of Rs.6.15 crore.
54
Chapter II – Results of Audit
2.3.7.5
Failure to
utilise available
funds in time
resulted in
lapse of grants
Lapse of grant due to non-utilisation
A review of the grant and outlay register of PREDs, Bellary and Huvina
Hadagali revealed that funds released by the ZP for implementation of various
schemes of water supply, rural roads, construction of buildings, etc., was not
optimally utilised, depriving the rural population of the envisaged benefits as
detailed below.
(Rupees in crore)
6
Year
2003-04
2004-05
2005-06
2006-07
2007-08
Amount released by ZP
to PREDs
Bellary
Huvina
Hadagali
10.58
4.99
8.31
3.59
9.15
7.86
19.90
8.25
30.96
22.00
Amount utilised
Bellary
2.76
7.79
7.67
12.50
19.99
Huvina
Hadagali
4.75
3.50
6.70
4.15
8.76
Amount lapsed
Bellary
7.82
0.52
1.48
7.40
10.97
Huvina
Hadagali
0.24
0.09
1.16
4.10
13.24
It could be observed that Rs.24.21 crore remained unutilised during 2007-08
after discontinuation of LOC system in both the PREDs. The Audit Officer,
PRED, Huvina Hadagali attributed (October 2008) the non-utilisation of funds
to delay in finalisation of tenders and action plan.
Similarly, an amount of Rs.2.88 crore was released to the ZP during 2004-06
for implementation of Pradhan Mantri Gramodaya Yojana (Nutrition and
Health). Though the funds were adjusted to ZP fund (2004-06), the CAO did
not release the same to implementing officers and remitted back the entire
amount to Government account, thus, depriving envisaged nutrition and health
facilities to women and children in rural areas.
2.3.7.6
on-recovery of
dues resulted in
reduction of
grants
3on-recovery of tax revenue and water supply charges
The provisions of KPR Act empower the GPs to levy and collect tax to
augment their resources and water supply charges to maintain the water supply
schemes. The Village Water and Sanitation Committee at the GP level were
to fix, revise and collect water charges sufficient to meet the operation and
maintenance cost of the schemes. It was noticed in ZP, Bellary that as of
March 2008, an amount of Rs.8.37 crore was outstanding towards general tax
revenue and the ZP did not furnish the details of dues towards water supply
charges. Similar position in the test-checked TPs was as follows.
Taluk
Hospet
Huvina Hadagali
General Tax Revenue
Demand Collection Balance
236.83
109.49
127.34
117.75
40.21
77.54
55
(Rupees in lakh)
Water supply charges
Demand Collection
Balance
60.00
13.20
46.80
27.17
10.70
16.47
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
It could be seen that the recovery of dues was meagre ranging from 22 to 46
per cent of the demand raised. Similarly, in respect of test-checked GPs also
there was deficit in collection of water supply charges compared to the actual
expenditure on maintenance of water supply schemes. Due to shortfall in
collection, the test-checked GPs (11) did not pay electricity charges incurred
on water supply schemes and as a result, the ZP deducted an amount of
Rs.1.09 crore during 2003-08 in respect of those GPs from the development
grants due.
2.3.7.7
Inadequate internal audit/controls
The CAO of the ZP was to conduct internal audit of all the offices under the
jurisdiction of ZP and to audit all the transactions both centrally at the ZP and
locally in respective offices. It was observed that the CAO had not conducted
audit centrally and there was shortfall ranging from 69 to 75 per cent of
offices to be audited locally. The laxity in internal controls was evident from
the fact that CAO had instructed the PREDs/departments to withdraw funds to
avoid lapse of grants as detailed in paragraph 2.3.7.3.
Developmental activities implemented by line departments
2.3.8
Education Department
Literacy plays a vital role in the overall development of a society. As per the
census of 2001, the Bellary district had an overall literacy rate of 57 per cent
with women literacy rate of 46 per cent. It was seen in audit that even as of
March 2008, the literacy rate remained the same despite huge investment in
these years under the education sector. The Department was headed by a
Deputy Director of Public Instructions (DDPI) assisted by Block Education
Officer (BEO) at the taluk level. As of 2007-08, there were 157 High Schools
and 1,360 Higher/Lower Primary Schools33 (HPS/LPS) in the district.
The main objective of primary education was to ensure that every child in the
age group of 6-14 years attends school, attains the minimum level of learning,
reduce the dropout rate, community participation in the betterment of schools
and mainstream the children dropped out of the schools through various
programmes.
33
excluding aided and private schools in the district
56
Chapter II – Results of Audit
2.3.8.1
The budget
proposals were
unrealistic as
DDPI demanded
additional funds
despite
persistent
savings during
previous years
Unrealistic budget proposals
The DDPI was responsible for submission of budget estimates for primary
education and secondary education for the district. The budget proposed, funds
released and expenditure of the Department during the period 2003-08 was as
follows.
(Rupees in crore)
2003-04
Budget
proposed
196.44
2004-05
220.15
2005-06
2006-07
Year
Funds
released
88.13
Expenditure
Savings
87.74
0.39
90.18
90.05
0.13
293.46
95.75
95.48
0.27
308.14
104.20
100.35
3.85
149.82
1.00
2007-08
347.46
150.82
Source : Information furnished by the DDPI
It could be observed from the above that though there was persistent savings
during the review period, the DDPI proposed more than twice the expenditure
during 2004-05 and more than thrice the expenditure during 2005-08 of the
preceding years, evidencing unrealistic budget proposals, without considering
actual requirements. The DDPI stated (July 2008) that the proposals for
budget requirement as received from the BEOs were consolidated and
forwarded to ZP/State Government. DDPI also admitted (January 2009) that
the proposals included requirement for vacant posts, which was against the
codal provisions.
Further, the test-check of records revealed that the efforts of the department in
achieving the objectives were not adequate as discussed below:
2.3.8.2 Programme implementation
Shortfall in
enrolment and
increasing trend
of drop out rate
defeated the
objective of
education to all
The Department was to ensure that all the identified children were enrolled
in the school. The envisaged goal of providing education to all children
was not achieved as the shortfall in enrolment had increased from 29,634 in
2003-04 to 34,207 children in 2007-08.
One of the goals of the Department was to reduce the school dropout rate to
nil by 2010. However, the dropout rate of children under both primary and
high schools was showing an increasing trend since 2005-06 and during
2007-08 the dropout rate was nine and 23 per cent respectively. Thus, the
achievement of the targeted objective of ‘nil dropout’ remained remote in
the district.
Though many programmes such as “Chinnara Angala”, “Bridge School”,
“Sanchari Shale” were in operation to mainstream all the students who
dropped out of schools in the age group of 6-14 years, the goal remained
57
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
unachieved even after incurring expenditure of Rs.1.56 crore during
2003-08 as 2,974 children still remained out of school (2008).
The number of children who dropped out of schools at the transition from
VII to VIII standard was 12 per cent when compared to State average of
eight per cent during 2007-08 and in respect of girls, the percentage was 15
as against the State average of nine.
The DDPI attributed (July 2008) the increase in drop-out rate to poverty,
migration and unwillingness among parents to send their children to school.
2.3.8.3
Vacant posts/non-deployment of teachers
The number of vacant posts in respect of teaching staff in the Department
increased from 289 [4.20 per cent of sanctioned strength (SS)] during
2003-04 to 524 (6.42 per cent of SS) in 2007-08 in respect of HPS/LPS and
in respect of high schools, it increased from 84 (8.18 per cent of SS) to 185
(11.44 per cent of SS), hampering the teaching process.
No teachers were posted to 22 schools and 70 schools were functioning
with only one teacher in the district, in contravention to the norms of
minimum two teachers in a school.
The Department was to identify the excess teachers in each school and
redeploy them by the end of October each year. In the district, though 102
to 202 teachers were identified as excess during 2005-08, effective action
had not been taken to redeploy them. Out of the 202 teachers identified as
excess in 2007-08, 40 teachers had not been re-deployed during 2007-08
resulting in the schools continuing with excess staff. Despite departmental
instructions, the redeployment was made after the closure of the academic
year, thus, defeating the purpose of identification and re-deployment of
teachers.
The DDPI stated (July 2008) that the State Government was to fill up the
vacant posts. Further, the DDPI, attributed delay in redeployment of excess
teachers to delay in receipt of clear information from BEOs. This was
indicative of the laxity of DDPI in complying with the State Government
instructions though large number of schools had vacancies/no teachers.
2.3.8.4
Basic
infrastructure
facilities were
lacking in
schools
Large gaps in infrastructure facilities
As of 2007-08, as against the requirement of 8,258 class rooms, only 6,700
class rooms were available in the district resulting in shortfall of 19
per cent.
Though HPS/LPS cater to the students from standard I to VII, 357 schools
in the district were functioning in buildings having only one (55) or two
(302) class rooms. It was also noticed in audit that though Rs.17 lakh was
58
Chapter II – Results of Audit
drawn (2005-07) and paid to Karnataka Land Army Corporation (KLAC)
for construction of 10 class rooms in respect of five schools, the KLAC did
not commence (December 2008) the work as suitable land was not made
available resulting in blocking up of funds with the construction agency.
Provision of basic infrastructure to each school is one of the tasks of the
Department. It was seen in audit that out of 1,360 HPS/LPS in the district,
218 and 337 schools did not have basic infrastructure like water supply and
toilets respectively. Further, schools were not provided with electricity
(583), furniture (706), book bank (272) and computers (1,290). In 526
schools, ramp facility was not provided for physically challenged students.
Play grounds were not in existence in as many as 833 schools.
529 out of 6,700 class rooms required major repairs and 1,195 required
minor repairs indicating poor maintenance in schools which exposed the
students to risk.
The DDPI admitted (July 2008) that the data relating to school infrastructure
was incomplete. It was noticed in audit that the DDPI furnished the same set
of information to State Government. Furnishing incomplete information to
higher authorities was indicative of laxity of DDPI in improving the basic
infrastructure to the schools. Further, DDPI did not furnish to Audit the
information on funds requirement to carry out repairs and provide the above
required infrastructure.
2.3.8.5
Monitoring
In order to improve the educational standard of schools and to guide teachers
at taluk level, the BEOs of the taluks were to visit and inspect schools atleast
once in a year. It was, however, noticed that out of 1,810 schools including
aided schools in the district, the number of inspections conducted by BEOs
ranged between 720 and 826 during the period 2005-08.
The School Development Management Committee which was to
supervise/monitor proper functioning of the school and ensure community
participation was not constituted in 269 schools.
Non-provision of basic infrastructure, vacant posts of teachers in the schools
and laxity in enrolment/retention had a bearing on the envisaged quality
education which was also evident from the fact that the district declined from
eighth position in 2000-01 to 29th position in 2007-08 with overall pass
percentage of 60 at the level of X standard.
59
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.3.9
Health and Family Welfare Department
The primary objective of the Department is to provide comprehensive health
care consisting of curative, preventive, promotive and rehabilitation health
care to the people. The District Health and Family Welfare Officer
(DH&FWO) was the head of the Department in the district assisted by District
Malaria Officer, District Leprosy Officer and District Blindness Control
Society and Taluk Health and Family Welfare Officer at the taluk level. There
were eight Community Health Centres (CHCs) and 47 Primary Health Centres
(PHCs) in the district. During 2003-08, an amount of Rs.72.20 crore was
allocated/released to the Department and an expenditure of Rs.70.27 crore was
incurred.
2.3.9.1
3on-adhering to norms in establishment of PHCs and CHCs
According to the norms of the Department, each PHC and CHC was to cater to
30,000 and 1.20 lakh population respectively. Out of every four such PHCs,
one was to be upgraded as a CHC - the first referral hospital having
specialised medical facilities. As of 2007-08, the position of existence of
PHCs and CHCs in the taluks of the district was as shown in the table below.
umber of centres to
be established
PHC
CHC
12
3
Actually
established
PHC
CHC
12
1
Bellary
Total rural population
as of 2008
(in lakh)
3.82
Sandur
2.24
7
2
4
1
Siruguppa
2.02
7
2
5
1
Hospet
2.02
7
2
7
Nil
Kudligi
2.70
9
2
6
3
Huvina
Hadagali
2.11
7
2
7
1
HB Halli
1.80
6
1
6
1
16.71
55
14
47
8
ame of the
taluk
TOTAL
As of March 2008, against the requirement of 55 PHCs and 14 CHCs, there
were only 47 PHCs and 8 CHCs. The existence of CHCs among the taluks
was not uniform as Hospet had no CHC whereas Kudligi had three against
norm of two. Due to shortfall in establishment of PHCs and CHCs, the
intended objective of providing primary health facilities to the rural population
within a short distance from their places could not be achieved. In addition to
these PHCs, 293 Primary Health Sub-centers, manned by a Health Assistant
and having a visiting doctor, were functioning in the district.
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Chapter II – Results of Audit
2.3.9.2 There were shortfalls in implementation of various health schemes/
programmes as discussed in the paragraphs below.
Due to shortage
of staff, lack of
awareness about
health facilities,
the objective of
providing health
for all was not
achieved
The objective of providing ‘Health for all’ suffered due to large number of
vacant posts in all the cadres. During 2003-08, the percentage of shortfall
in general doctors ranged from 23 to 30 whereas in respect of specialists it
ranged from 67 to 74. The percentage vacancy in respect of staff nurses
varied between 21 and 37. As of March 2008, 142 posts of Health
Assistants who were to create health awareness among the rural population
and instrumental in preventive/curative services, were vacant. The details
of sanctioned strength, men-in-position and vacancy in different cadres is
given in Appendix 2.4.
Contrary to the guidelines of Medical Council of India, Ayurvedic doctors
were working in allopathic CHCs/PHCs and prescribing allopathic
medicine.
In disregard of State Government instructions, only 11 out of 35 identified
PHCs were functioning round the clock reportedly due to non-availability
of residential doctors and staff.
There was shortfall in conducting ante-natal check-up of registered
pregnant women. The envisaged three check-ups were not conducted in
respect of 0.78 lakh pregnant women out of 2.99 lakh registered. The
DH&FWO attributed (October 2008) the shortfall to lack of awareness
among people. The fact, however, remained that even with 502 health
assistants under its control, the DH&FWO could not create awareness
among the rural population.
Though the aim of the State Government was to make 80 per cent of the
deliveries ‘institutional’ by 2010 so as to reduce the mother/infant mortality
rate, the percentage of institutional deliveries in the district during 2003-08
ranged from 36 to 43 evidencing failure of the authorities in creating
awareness among the rural population. The DH&FWO attributed (October
2008) the lapse to non-availability of residential staff. Considering the
present rate, achieving the envisaged goal by 2010 was doubtful.
Though an expenditure of Rs.76 lakh was incurred on ‘National Leprosy
Eradication Programme’ in the district during 2003-08, the prevalence rate
varied between 1.14 and 3.35 per cent (0.58 per cent being the State
average) and Bellary was the only district to have prevalence rate at more
than one per cent. Further, it was also noticed that the Model Leprosy
Control Unit (Unit) established in Hospet was functioning without a doctor
since 2003 and an expenditure of Rs.41.24 lakh was incurred during 200308 on the pay and allowances of supporting staff (physiotherapist,
paramedical workers, lab technician, driver and a group ‘D’) of the Unit.
Non-posting of a qualified doctor to the Unit, despite having high
61
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
prevalence rate, indicated laxity of the Department in eradicating the
disease.
As against the target of 45,000 cataract operations under ‘National
Programme for Control of Blindness’, 41,136 operations were conducted in
the district during 2003-08. However, it was noticed that large number of
operations were conducted in urban places like Bellary and Hospet (88
per cent) defeating the objective of providing low cost health care to rural
poor at their places. The post of Ophthalmic Surgeon had not been filled in
other five taluks for four to eight years. The two Mobile Ophthalmic Units
(MOUs) available in the district were grossly under-utilised, denying the
rural poor of improved eye care. It was noticed in audit that during
2003-08, the MOUs conducted only four to 22 camps (each year) of three
days each. Though it was mandatory to check all the school children in the
age group of 10-14 years for any refractive errors, no child was tested in the
district till 2006-07 and as against the target of testing 1.08 lakh school
children during 2007-08, only 0.40 lakh (38 per cent) were tested. The
envisaged training to teachers in ophthalmic testing was also not provided.
Minimum basic infrastructure of water supply and electricity were not
provided to 34 and 43 PHCs/PH Sub-centers respectively in the district.
Further, 42 and 25 centres required repairs to roof/flooring and toilets
respectively.
2.3.9.3 The DH&FWO while generally accepting (September 2008) the
observations, attributed the short comings to inadequate doctors/staff. It was
further stated that the ZP had instructed DH&FWO to take up the minor repair
works under National Rural Health Mission which, however, did not provide
any fund. Besides, no budget provision was made for the much needed major
repairs.
2.3.10 Forest, Ecology and Environment Department
The National Forest Policy, 1988 prescribed that one-third of the total land
was to be covered by forest. In Bellary district, only 15 per cent of the total
land (1,26,947 Hectare) was covered by forest and it was proposed to reach
the standard by the year 2012. The Social Forestry Division in the district was
headed by a Deputy Conservator of Forest (DCF) assisted by an Assistant
Conservator of Forest (ACF) and the Range Forest Officers at the taluk level
were assisted by subordinate staff. The programmes for afforestation under
the district sector were undertaken by ZP through the division. The primary
objectives of the division included raising seedlings, distribution among the
beneficiaries and raising of plantations in the allotted places as per the action
plan approved by the competent authority.
62
Chapter II – Results of Audit
2.3.10.1
The area brought
under green cover
was negligible
though
expenditure
incurred on
establishment was
high
Under-utilised establishment
A review of records of the division for the period 2003-08 disclosed that
though an expenditure of Rs.4.29 crore had been incurred on the
establishment, the area brought under the green cover was only 37 hectares
during the years 2003-05. It was observed that during 2003-08, no specific
scheme had been implemented in the ZP except roadside plantation under
Sampoorna Grameena Rozgar Yojana (SGRY).
According to the information furnished by the DCF, Bellary with the available
resources, the division could raise 10-15 lakh seedlings annually and
possessed tools/equipment and vehicles valued at Rs.29.17 lakh as of
March 2008. It was, however, noticed that the seedlings raised in the division
during 2003-08 ranged between 1.23 lakh and 4.57 lakh evidencing that the
resources/assets were grossly under-utilised. The DCF stated (August 2008)
that though action plans were prepared by the division, ZP did not approve any
of the schemes. Audit also noticed that during 2004-08, the DCF had
submitted eight proposals/action plans requiring an amount of Rs.4.86 crore,
which were not approved by the ZP. Thus, failure of the ZP in according
approval to action plan submitted by DCF resulted in idling of available
resources despite availability of staff. As such, achieving goal of covering 33
per cent of land under forest by the year 2012 remained a distant possibility.
2.3.10.2 Unfruitful expenditure due to non-maintenance of plantations
An expenditure
of Rs.57.40 lakh
may go wasteful
as plantations/
seedlings were
not maintained
As per the forestry and environment project report for eastern plains of
Karnataka State, plantations raised in institutional land had to be carried out in
pit planting design with irrigational support and protected by barbed wire
fencing. Further, according to the instructions regarding upkeep and
maintenance under the social forestry, the plantations were to be maintained
for a period of three years after planting. Test-check by audit revealed the
following:
(a)
The ZP, Bellary launched (January 2003) ‘Hasareekarana’, a
programme intended to plant seedlings in the premises of schools and
hospitals and released Rs.21.80 lakh during 2003-05 to the division.
Accordingly, the division implemented the programme in the district. Records
revealed that the ZP did not release any funds towards maintenance of plants,
though these were to be maintained for three years. The survival of these
plantations was, thus, doubtful.
(b)
Survival of the seedlings raised and planted along the roadside for a
stretch of 138 kilometers incurring an expenditure of Rs.32.84 lakh under
SGRY during 2005-06 was doubtful as the plantations were not maintained
63
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
after the first year. The ZP did not release funds for maintenance though
requested by the division. Similarly, 15,025 seedlings raised during 2006-07
at a cost of Rs.2.76 lakh were neither planted nor maintained during the
succeeding years.
Thus, the expenditure of Rs.57.40 lakh incurred on plantations was likely to
become wasteful due to non-maintenance.
The DCF accepted (August 2008) that the division had not supervised the
maintenance work and had no information about the present survival. Thus,
the failure of ZP in releasing adequate funds resulted in non-maintenance of
plantations/seedlings, etc.
2.3.11
Youth Services and Sports Department
The Assistant Director was the head of the Department and was assisted by
two coaches in the district. The Department was responsible for providing
proper infrastructure for sports activities. The following points were noticed
during the course of review.
2.3.11.1
Failure to provide
drainage to
cinder track
resulted in
wasteful
expenditure of
Rs.43 lakh
Wasteful expenditure on laying of cinder track
On the directions of the Commissioner, Youth Services and Sports, Bangalore,
the work of laying of cinder track in the existing district stadium at a cost of
Rs.43.63 lakh was entrusted (January 1999) by the Assistant Director to
KLAC, Bellary. The estimate for the work was prepared by KLAC, which did
not provide for a proper drainage system. The KLAC commenced the work
during December 1999 and completed the work (March 2001), without a
drainage system, incurring an expenditure of Rs.43 lakh. The KLAC,
however, warned (November 2000) that non-provision of drainage system
would cause damage to the track. In spite of the warning, no action was
64
Chapter II – Results of Audit
initiated by the Assistant Director/ZP to provide additional funds for provision
of drainage system. After taking over the track, the Assistant Director
requested (September 2001) the Commissioner to release additional funds for
providing a drainage system to the track. However, no funds were released by
the authorities. The track developed cracks due to stagnation of water,
rendering the expenditure of Rs.43 lakh wasteful.
Though KLAC prepared the estimate, it was the responsibility of the Assistant
Director to ensure that proper estimates were prepared incorporating all the
requirements, as substantial funds were being invested through the
Department. Thus, negligence of the Assistant Director in entrusting the
work, though the estimate was deficient, resulted in wasteful expenditure of
Rs.43 lakh and also denied the youths of the district of improved sports
facility.
2.3.11.2 Loss of central assistance for construction of an indoor stadium
The State Government accorded (April 2000) administrative approval for
construction of an indoor stadium including a swimming pool at an estimated
cost of Rs.3.40 crore, for which the GOI assured (October 2001) to provide
grants of Rs.1.20 crore subject to the condition that the grants should be
utilised within two years. Meanwhile, a dispute arose (June 2000) regarding
the title of the land identified for the construction and the claimant obtained a
stay order from the Court. As the work did not commence within the stipulated
period, the GOI withdrew (August 2004) the proposal of providing assistance
to the work.
Audit observed that the land was classified as ‘play ground’ as per the survey
and resettlement register and was in possession of the Department even earlier
to 1972. Despite this, the Assistant Director did not represent the case
properly and get the stay vacated in time. Assistant Director stated (March
2009) that the Commissioner had decided not to proceed with the case. This
resulted in GOI withdrawing the assistance of Rs.1.20 crore, thus, denying the
benefits of the envisaged indoor stadium to the people of the district.
2.3.11.3
Abnormal delay
in completion of
stadia rendered
the expenditure
of Rs.45.04 lakh
unfruitful besides
cost escalation
Abnormal delay in completion of stadia
Based on the decision (March 1992) of the High Powered Committee for
development of Hyderabad-Karnataka area, the State Government accorded
(August 1992 and September 1997) sanction for construction of stadia in three
taluks through assistance from GOI, ZP and Hyderabad Karnataka
Development Board. All the works were entrusted (1992-99) to KLAC and
the details of estimated cost, funds released, expenditure and present status
65
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
(October 2008) of the stadia were as detailed below.
Taluk
Estimated
cost
Funds
released
Hospet
16.24
10.00
Siruguppa
22.02
10.00
25.14
24.80
63.40
44.80
Huvina
Hadagali
TOTAL
Expenditure
(Rupees in lakh)
10.00
(as of June 2001)
10.15
(as of June 2001)
24.89
(as of April 2006)
45.04
Revised
estimated cost
27.00
(as of June 2001)
30.00
(as of June 2001)
114.55
(as of April 2006)
171.55
Present status
Pavilion partially
completed
Pavilion
completed
Pavilion partially
completed
It could be observed from the table above that the construction of stadia
remained incomplete even after 11 to 16 years of sanction. The Department/
ZP did not make adequate efforts to obtain funds for the construction from the
State Government and did not collect the required public contribution. Due to
delay in completion of work the GOI refused (September 2000) to provide
grants. The fact that the estimates in respect of stadia at Hospet and Siruguppa
were not revised since 2001 was indicative of laxity of the Department in
completing the works. This rendered the expenditure of Rs.45.04 lakh
incurred, unfruitful. The cost of the work is likely to escalate further due to
efflux of time.
2.3.11.4
3on-utilisation of funds under the Rajiv Gandhi Yuvashakthi
Programme
The State Government introduced (October 2003) ‘Rajiv Gandhi Yuvashakthi
Programme’ wherein it was proposed to provide grants of Rs.10,000 to any
organisation (Sangha) formed exclusively to undertake community
development, sports, cultural, educational and personality development. The
grant was to be released to only one Sangha in each GP. During the period
2003-07, the Assistant Director of the Department in Bellary received an
amount of Rs.35.66 lakh34 from the State Government. Of this, the Assistant
Director released only Rs.17.40 lakh35 to 189 Sanghas in the district during the
years 2003-04 and 2004-05.
Test-check of records disclosed that though Rs.17.40 lakh was utilised as of
October 2008, the Assistant Director irregularly issued utilisation certificate
for an amount of Rs.19.93 lakh during May 2005 itself. Though the unspent
balances were to be remitted back to Government account every year, the
Assistant Director did not remit the balance of Rs.18.26 lakh36 which was
lying in a savings bank account. It was further noticed that though funds
received during 2003-05 were not utilised in full, the Assistant Director drew
34
35
36
2003-04 - Rs.19.94 lakh; 2005-06 - Rs.10.45 lakh; 2006–07 - Rs.5.27 lakh
Grants provided partially
2003-04 - Rs.2.54 lakh; 2005-06 - Rs.10.45 lakh; 2006-07 - Rs.5.27 lakh
66
Chapter II – Results of Audit
funds during 2005-07 also and kept them in bank account. The practice of
keeping unutilised money outside the Government account was irregular.
2.3.12
Khadi and Village Industries Department
The Department was headed by Deputy Director assisted by Industrial
Extension Officers. The Department was responsible for distribution of
improved tool kits, providing assistance in getting loans from financial
institutions, etc., to artisans of rural areas in various trades to improve their
economic status besides providing training. The points noticed during the
performance review are brought out in the succeeding paragraphs.
During 2003-08, the expenditure on the implementation of schemes was
only Rs.18.75 lakh whereas the expenditure on pay and allowances of the
staff/establishment was Rs.54.13 lakh.
Financial assistance in the form of loan was being given to small
entrepreneurs in the district. It was noticed that, as of March 2008, an
amount of Rs.67.70 lakh was due from 123 beneficiaries. It was further
noticed that 34 beneficiaries from whom Rs.21.23 lakh was due had closed
down the establishments. The failure of the Deputy Director in ensuring
recovery at regular intervals resulted in non-recovery of loan. In reply to
audit, the Deputy Director stated that notices were issued to defaulting
entrepreneurs. The reply did not explain as to how recovery was proposed
to be effected from the defaulters as banks had the first charge on the
property mortgaged.
The staff working under Apiculture wing of the Department did not carry
out any activity during the period under review. As apiculture was not
suitable for the environmental conditions of Bellary, the State Government
transferred the activity to the control of Horticulture Department during
October 2003. Though it was claimed by the Deputy Director that the staff
were engaged in the process of recovery of seed money, it was noticed that
not even a rupee had been recovered by the Department till now.
Evidently, the staff of Apiculture Wing were not discharging any work
rendering the establishment expenditure of Rs.4.75 lakh on them nugatory.
The envisaged improved tool kits were not supplied to 210 trainees who
were trained in various fields during 2003-08 incurring an expenditure of
Rs.3.59 lakh. Besides, no assistance was extended to these trainees towards
getting financial support from institutions. Thus, the rural trainees could
not continue with the craft they were trained in, defeating the objective of
providing training and improving their economic status.
67
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Rental revenue had not been collected in respect of three properties given
(1997-2002) to three institutions37 though these institutions were charging
fees from the State Government for the services rendered. No rental/lease
agreement was entered into with any of these agencies.
Implementation of schemes/programmes/works
2.3.13
Rural Water Supply Programmes
The rural water supply programmes were implemented in the district with the
financial assistance both from GOI under Accelerated Rural Water Supply
Programme (ARWSP) and State Government under Minimum Needs
Programme (MNP). The funds for implementation of water supply works
were released through ZPs and the EEs of PREDs were responsible for
execution.
2.3.13.1
Deficiencies in implementation of water supply schemes
According to the information furnished by the ZP, a total sum of Rs.92.66
crore was released to ZP, Bellary (under both ARWSP and MNP) during
2003-08 against which an expenditure of Rs.52.88 crore was incurred. It was
noticed in audit that the available funds were not utilised completely due to
laxity in preparation/forwarding of annual action plans, with delay ranging
from seven to nine months. As a result of delay in forwarding the action plans
to the State Government, the approval was obtained only during the months of
December-March each year.
2.3.13.2
Audit further observed as follows:
During 2004-08, out of 6,077 water supply works taken up for execution,
only 4,771 works were completed.
The norms38 of water supply schemes were flouted as 213 habitations were
provided with MWS/PWS, which were otherwise ineligible. Also the
envisaged quantity of water (40 lpcd) was not supplied to many villages.
Out of 1,014 villages in the district, ground water in 487 was identified as
chemically affected. The ZP, however, took up water supply works
covering only 168 villages (34 per cent) for providing safe drinking water
due to improper planning.
Out of 226 works taken up under ‘Suvarnajal’– a scheme for providing safe
drinking water to school children through roof top water harvesting, 172
37
38
KEONICS, SIRD and Bellary Garment Manufacturers’ Association
A bore well fitted with a hand pump – for population up to 500, Mini Water Supply scheme
(MWS) – for population between 500-1000 and piped water Supply (PWS) scheme – for
population above 1000
68
Chapter II – Results of Audit
works were completed at a cost of Rs.45.54 lakh. It was, however, noticed
that the quality of the water supplied was not got tested. Thus, the school
children were supplied stored rain water without conducting the envisaged
quality test ensuring potability.
Source sustainability measures (such as check dams, direct injection, etc.,
for recharging of ground water) were not adopted till 2005-06 in respect of
bore wells though large number of water supply schemes were executed.
Further, it was also noticed that though an amount of Rs.1.10 crore was
released to PREDs during 2006-08 under the head ‘ground water
recharging’, only an amount of Rs.0.57 crore had been utilised. Even
where such measures were taken, the EE had stated that the opinion of the
geologist was not obtained regarding the point of recharge. In the absence
of expert opinion, it was doubtful whether the expenditure incurred on
sustainability measures was fruitful.
The water testing laboratory in the district was grossly under-utilised to the
extent that as against 72,760 samples39 required to be tested during 200308, only 316 samples were tested. Also, no budgetary allocation was made
for functioning of the laboratory during this period.
2.3.13.3 Improper planning leading to non-implementation of a scheme
under private-public participation
Failure in
obtaining
permission of a
GP to draw water
resulted in nonimplementation of
a water supply
scheme.
ZP, Bellary agreed (September 2005) to provide safe drinking water to 14
villages around the Steel Plant of a private sector company40 and a
Memorandum of Understanding (MoU) was entered into (September 2006) for
Rs.4.97 crore based on the concept of private-public participation. The cost
was to be shared in the ratio of 70:30 between the company and the ZP and the
work was to be executed through PRED, Bellary. It was proposed to draw
water from ‘Daroji Reservoir’. The MoU, inter alia, clearly stipulated that
there should be an irrevocable resolution passed by all the members of Daroji
GP for drawing water from the reservoir and approval of competent authorities
for execution of the scheme.
It was noticed that though ZP/PRED, Bellary did not obtain the required
permission of Daroji GP, the ZP released (June 2006) an amount of Rs.50 lakh
to EE, PRED, which was deposited in a savings bank account. Meanwhile,
the GP, Daroji passed (August 2006) a resolution not to permit the PRED to
draw water from the reservoir as it would affect the agriculture activities under
its jurisdiction. As such, the scheme could not be implemented and the
amount of Rs.50 lakh remained in the savings bank account, besides, denying
the proposed water supply to the rural population.
39
40
7,276 water sources available x 5 years x 2 times a year
JSW Steel Limited
69
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.3.13.4 Defective estimates/designs and execution of substandard work
Preparation of
defective estimate
and failure to
ensure quality
work resulted in
extra cost of
Rs.19.24 lakh
The work of water supply scheme to Hirehadagali and Magala villages
estimated to cost Rs. Two crore under Submission Projects was entrusted
(May 2001) by the EE, PRED, Huvina Hadagali to a contractor41 at the
tendered cost of Rs.2.04 crore with a stipulation to complete the work within
18 months. The work was stopped (March 2006) after incurring an
expenditure of Rs.1.54 crore. The approach road to jack well was not laid by
the contractor. Trial testing of the completed works revealed leakages at
several joints in pipeline for raw/pure raising mains. The contractor was
instructed by the EE, PRED to conduct hydraulic test and complete the work.
Despite several notices, the contractor did not complete the work till July 2006
and the Chief Engineer (CE), Panchayat Raj Engineering (PRE) Department,
Bangalore rescinded (August 2006) the contract at the risk and cost of the
contractor.
Even the estimates/designs prepared by EE, PRED, Huvina Hadagali were
defective as the alignment of 1,200 mtrs. of raw water raising main was laid in
private paddy fields, which was to be removed and re-laid on the roadside
based on the directions (May 2006) of the CE, PRE Department, Bangalore.
The balance works including relaying and rectification of raising mains were
got completed (August 2008) through another agency at a cost of Rs.33.20
lakh. Failure of the Department to ensure quality work by the first contractor
resulted in additional expenditure/liability on rectificatory works costing
Rs.19.24 lakh besides delay by more than six years.
2.3.13.5
3on-commissioning of completed water supply schemes
Based on the approval of ZP, Bellary for the works under ‘Swajaldhara’
scheme, the works of two water supply schemes to two villages under TP,
Sandur was taken up by EE, PRED, Bellary and completed (May 2004 and
April 2005) at a total expenditure of Rs.12.38 lakh42. It was proposed to draw
water for both the schemes from the pipeline supplying water to Sandur town.
The Sandur Town Panchayat, however, refused the proposal and even as of
September 2008, the schemes remained idle without commissioning. Failure
of the ZP/EE, PRED to ensure proper source of water before commencement
of work resulted in non-commissioning of the schemes executed at a cost of
Rs.12.38 lakh.
41
42
Arun Engineering Projects (Private) Limited, Bangalore
Bhujanganagar (Rs.9.25 lakh) and Taranagar (Rs.3.13 lakh)
70
Chapter II – Results of Audit
2.3.13.6
Improper execution of ‘Suvarna Ane’– a scheme for construction
of check-dams
With the objective of recharging the depleted ground water, the State
Government launched (2005-06) the scheme ‘Suvarna Ane’, under NABARD
assisted RIDF-XI series, aiming to construct water harvesting structures/
check-dams in areas which were facing prolonged drought situations. The
scheme envisaged construction of three or four structures serially in
downstream/valleys. The guidelines were issued by the State Government in
November 2005 and the scheme was implemented in three taluks43 of Bellary
through PREDs. It was observed that though an amount of Rs.1.20 crore
(Rs.40 lakh per taluk) was released (December 2005) by State Government,
Rs.40 lakh was not released by ZP, Bellary to Huvina Hadagali taluk as the ZP
failed to upload the sanction order on computer. In the other two taluks, 10-11
structures were taken up at an expenditure of Rs.76.44 lakh.
Scrutiny of records in other two taluks (Sandur and Siruguppa) revealed that
the guidelines were subverted as detailed below:
The divisions did not obtain the required maps and details from Karnataka
Remote Sensing Agency and were also not in possession of details of
irrigation and drinking water wells in the downstream and on either side of
the valley which would get recharged as a result of the project
implementation.
The envisaged low cost technology was not adopted in any of the structures
and estimates were prepared in a routine manner.
In the absence of required data/information, the viability of the structures
constructed at a cost of Rs.76.44 lakh could not be ensured in audit.
2.3.14
Delay in completion of works
2.3.14.1 Water supply works
Abnormal delay
in completion of
six water supply
schemes rendered
the expenditure of
Rs.12.07 crore
unfruitful besides
cost escalation
Scrutiny of records of the EE, PRED, Bellary revealed that six water supply
works approved/taken up under Submission Projects and ‘Swajaldhara’
scheme remained incomplete (December 2008) for periods ranging from 19 to
64 months after the scheduled date of completion. An expenditure of
Rs.12.07 crore was incurred on these incomplete water supply projects as
detailed in Appendix 2.5. Abnormal delay in completion of these water
supply schemes rendered the expenditure unfruitful besides cost escalation of
Rs.3.73 crore in respect of three works under Submission Projects. The EE,
PRED attributed non-completion of works to the objection raised by the land
43
Huvina Hadagali, Sandur and Siruguppa
71
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
owners and abandonment of works by contractors. Reply of the EE, PRED is
not tenable in view of the fact that it was the primary responsibility of the EE
to ensure availability of land before execution of the works. It could be
observed from the details of the works under ‘Swajaldhara’, that the stipulated
period of completion which was only 3 to 4 months was unreasonably short as
compared to the period allotted to other similar works. In reply, the EE stated
that this was done as per the directions of the CEO, ZP, which ultimately led
to abandonment of work half way by the contractors and re-tendering of
works.
2.3.14.2
Failure of the
CEO, ZP to
ensure adequate
funds prior to
taking up the
work resulted in
wasteful
expenditure of
Rs.36.99 lakh
Buildings
(i)
The CEO, ZP, Bellary proposed (November 2003) the work of
construction of Rural Development Residential Training Centre at Bellary at
an estimated cost of Rs.1.55 crore utilising the grants from XI Finance
Commission, MP/MLA/MLC grants and HKDB funds. The work was
entrusted (November 2003) to KLAC with a stipulation to complete the work
by July 2006. Audit scrutiny revealed that though the ZP initially released
(November 2003) an amount of Rs.35.50 lakh under XI Finance Commission
Grants to KLAC, there was no further release from the envisaged sources.
The KLAC stopped (March 2006) the work after incurring an expenditure of
Rs.36.99 lakh on the building.
The building remained incomplete even after a lapse of 29 months of
scheduled completion rendering the expenditure wasteful as KLAC did not
continue the work due to escalation of rates. Thus, failure of the CEO, ZP to
ensure funds prior to commencement/entrustment resulted in wasteful
expenditure of Rs.36.99 lakh.
Failure to ensure
title of the land
and construction
of community
assets in private
lands rendered
the expenditure
of Rs.15.91 lakh
wasteful
(ii)
During 2001-04, the EE, PRED, Huvina
Hadagali took up
construction of three samudaya bhavans, a block of residential quarters for
doctors and a bus shelter at an estimated cost of Rs.27.50 lakh under HKDB
and MP grants. The scrutiny of records revealed that prior to commencement,
the division did not ensure the title of the land and executed the works on
lands belonging to private parties. As of September 2006, the division
incurred an expenditure of Rs.15.91 lakh on these works which remained
abandoned, rendering the entire expenditure wasteful. The EE, PRED, Huvina
Hadagali stated (October 2008) that there is likelihood of taking up the
balance work after the title and ownership of land is settled.
72
Chapter II – Results of Audit
2.3.14.3 Road works
(i) Two road works taken up (January 2005 and April 2006) by EE, PRED,
Bellary under NABARD assisted RIDF scheme at an estimated cost of Rs.40
lakh remained incomplete in spite of incurring an expenditure of Rs.25.55 lakh
as below.
ame of the work
Estimated Expenditur
cost
e incurred
(Rupees in lakh)
Improvements to road from
Mustagatta to Kydagihal in Bellary
taluk
Improvements to road from AdoniSiruguppa road to Agasanur
Work
order
given on
Scheduled
date of
completion
28.00
19.73
24-1-2005
24-7-2005
12.00
5.82
30-4-2006
30-10-2006
EE attributed (August 2008) non-release of funds from ZP for non-completion
of work and further stated that the delay would result in deterioration of items
of road work already completed. The failure of the ZP to provide adequate
funds in time for the approved works rendered the expenditure of
Rs.25.55 lakh unfruitful.
(ii) Similarly, the work of laying road from Ujjini to Ramapura taken up by
PRED, Huvina Hadagali during March 2005 at an estimated cost of Rs.20 lakh
also remained incomplete due to the death of contractor, after incurring an
expenditure of Rs.7.77 lakh. The EE prepared a revised estimate for Rs.12.04
lakh for the balance works and obtained (December 2006) the approval of the
CE. On re-tendering (September 2007), the lowest bidder quoted Rs.18.94
lakh for the work. Instead of requesting for additional funds, the EE
arbitrarily proposed (March 2008) to the CEO and the ZP for closure of the
work on ‘as-is-where-is’ basis, quoting inability to complete the work within
the allotted funds. Further developments in the matter were awaited (March
2008). Thus, the arbitrary decision of the EE, PRED, Huvina Hadagali to
discontinue the work rendered the expenditure of Rs.7.77 lakh unfruitful
besides depriving connectivity to the villages.
2.3.14.4 Lift irrigation scheme
Delay in
completion of a lift
irrigation scheme
resulted in
unfruitful
expenditure of
Rs.7.75 lakh
besides cost
escalation of
Rs.17.56 lakh
The State Government approved (April 2002) a lift irrigation scheme under
Ganga Kalyan Yojana to Udegolam and Tekkalakote villages in Siruguppa
taluk at an estimated cost of Rs.27.59 lakh and released an amount of
Rs.18.34 lakh. The CE, PRE Department accorded technical sanction
(November 2002) and entrusted the work to a contractor for Rs.28.61 lakh.
The work was to be completed by November 2003. The contractor stopped
(March 2004) the work after showing a financial progress of Rs.7.75 lakh.
Despite several notices, the contractor did not commence the work and
73
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
contract was rescinded (September 2005) by the CE at the risk and cost of the
contractor.
The revised estimates for the balance works were, however, prepared and
fresh tenders were invited by EE, PRED, Bellary only during December 2006,
after a lapse of 15 months. The work was entrusted (July 2007) to another
contractor at a cost of Rs.38.42 lakh stipulating six months for completion.
The work which commenced in December 2007 was yet to be completed
(March 2009). Thus, the failure of the EE, PRED in monitoring timely
completion of the work coupled with delay in re-tendering resulted in extra
cost of Rs.17.56 lakh besides denial of intended irrigational facilities to the
rural population. The EE, PRED admitted (August 2008) that the recovery of
the extra cost from the first contractor was doubtful.
2.3.15 amma Bhoomi – amma Thota Scheme
The State Government implemented (September 2005) ‘Namma BhoomiNamma Thota’ (Scheme) wherein it was proposed to distribute land44 to
landless rural labourers to improve their economic and social status in the
society. The funds for the implementation of the Scheme were released by the
ZP to TPs and in turn to GPs. The GPs were responsible for purchase of
required land and selection of beneficiaries. Social Justice Standing
Committee of ZPs were responsible for proper implementation/monitoring of
the Scheme.
The implementation of the Scheme in the district suffered due to the
following.
The ZPs did not prepare the envisaged perspective plan for five years.
As against the total release of Rs.2.31 crore to 41 GPs during 2005-07,
an amount of Rs.1.19 crore had been utilised. Out of the balance of
Rs.1.12 crore, an amount of Rs.0.97 crore was remitted back to
Government account, which was in violation of instructions (February
2008) to remit back the entire unutilised funds. It was observed that 10
GPs did not utilise funds and refunded the entire amount of
Rs.0.54 crore. The reason stated was non-availability of land at the
rates prescribed by the State Government.
The Scheme envisaged coverage of all the landless labourers over a
period of five years (20 per cent annually). It was observed that
though the district had 29,018 landless labourers as of December 2005,
the target fixed during 2005-06 and 2006-07 was 2,673 and 2,482
respectively indicating inadequacy in implementation of the Scheme.
44
Five guntas of dry land or 2.5 guntas of wet land
74
Chapter II – Results of Audit
It was noticed in six GPs that 1,897 guntas of land purchased for the
implementation of the Scheme had not been distributed to the
beneficiaries. Further, in two GPs, the land purchased was converted
to layouts and sites in contravention to the Scheme guidelines resulting
in inadmissible expenditure of Rs.1.74 lakh.
The envisaged integration of schemes under various departments to
assist in improving economic and social status of the targeted group
was not achieved.
Audit also noticed instances of incorrect reporting of facts. In five
test-checked GPs under Huvina Hadagali taluk, even though no land
was distributed to any of the beneficiaries, it was reported to State
Government that 1,671 guntas of land had been distributed. Similarly,
though the TP, Hospet, reported (March 2007) 670 guntas of land as
having been distributed, subsequently retracted (March 2008) the
statement as undistributed.
Though the Committees at the level of GP and TP were to meet every
month to monitor the progress of implementation, the number of
meetings held in test-checked TPs and GPs ranged from two to four
during 2005-08 indicating laxity in monitoring.
Even though there were instances of distribution of sites instead of
land to the rural poor, the ZP failed to supervise the implementation of
the Scheme and merely consolidated and forwarded the progress report
to State Government.
As the Scheme failed to achieve the objective due to non-availability
of land at the cost prescribed, the State Government had ordered
(February 2008) to remit back the unutilised fund.
CEO, ZP stated (December 2008) that the distribution of land was under
progress. It was further stated that conversion of land to sites was without the
knowledge and approval of CEO, ZP and that a report in this regard had been
called for.
CEO, ZP and Deputy Secretary while agreeing in Exit Conference (January
2009) to the shortcomings noticed by Audit, stated that the Scheme had come
to a close.
75
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.3.16
Other points of interest
The work of improvement of road from Darur cross to Talur in Siruguppa
taluk for a length of 4.20 km45 was approved (September 2003) by
Government of India, under PMGSY Phase-III at an estimated cost of
Rs.53.40 lakh. The technical sanction was accorded (January 2004) by CE,
PRE Department. The work was entrusted (June 2004) to a contractor at the
tendered cost of Rs.53.31 lakh with a stipulation to complete the work within
nine months.
The proposed road was an ayacut road46 and according to the IRC
specification, California Bearing Ratio (CBR) test should be conducted to
assess the load bearing capacity of the road. Depending on the variation of
soil type, the preliminary tests were to be conducted at different chainages47 to
arrive at the CBR value. No documentary evidence for conducting such tests
was available with the EE, PRED, Bellary, but a CBR value of 3.85 was
adopted while preparing the estimates.
The work was commenced during June 2004 and during execution,
settlements were observed on the road surface which increased due to
movement of heavy vehicles. Even after carrying out the necessary
correction, the condition did not improve. On this being reported by the
Assistant Executive Engineer supervising the work, the EE directed to get the
CBR value rechecked evidencing uncertainty in adoption of accurate CBR
value in preparation of the estimate. The CBR values were rechecked by two
Agencies48 and were found to be in the range of 0.95 to 2.42. As per the
provisions of IRC, the maximum permissible variation in CBR value of
sample soil tested had to be +1. In the present case, however, the difference
worked out to more than 1.43 and upto 2.90 which indicated incorrect
adoption of CBR value at the time of preparing original estimate.
The work was dropped/abandoned from PMGSY-III package as per
recommendation of State Government.
Thus, failure of the EE, PRED, Bellary to follow the prescribed procedure and
adopt the correct CBR value for estimation led to sinking of road and stoppage
of work rendering the expenditure of Rs.20.01 lakh wasteful besides depriving
connectivity to rural habitations.
45
km 4.80 to km 9.00 which was earthern road surface
road in irrigable area
47
one or two tests in each kilometre
48
Vijayanagar Engineering College consultancy and State Technical Agency, Bangalore
University
46
76
Chapter II – Results of Audit
2.3.17
Conclusion
The performance review revealed that in ZP, Bellary, planning and budgeting
were not in conformity with the provisions of KPR Act and the functioning of
the DPC was ineffective. The internal control mechanism in financial
management was weak as evidenced by drawal of money by
PREDs/Departments on payees’ receipt at the end of the financial year and
keeping of funds outside Government account. ZP also failed to approve
action plans and provide adequate funds to line departments though proposals
were submitted. The internal audit to be conducted by the CAO was
inadequate.
Despite incurring considerable amount on various schemes, the Education
Department failed to achieve the objective of providing education to all the
children as there was decline in enrolment/retention rate and increasing trend
in drop out rate. While a number of posts of teachers remained vacant,
teachers identified as excess were not re-deployed in time. There were large
gaps in provision of minimum required infrastructure to school
buildings/classrooms.
Non-provision of PHCs/CHCs in accordance with the norms prescribed
resulted in denial of health care facilities to the needy rural poor. Even the
existing hospitals suffered due to shortage of doctors/staff. The intended goals
of the State Government such as ante-natal check-up, institutional deliveries,
eradication of leprosy, etc., were not reached. The Department did not accord
priority to proper infrastructure, though large number of PHCs/CHCs required
minor/major repairs.
The activities undertaken by the Social Forestry Division was negligible
compared to the expenditure incurred on the establishment. Large number of
seedlings/plantations raised incurring huge expenditure were not maintained,
rendering the survival doubtful.
No effective measures were taken by PREDs to complete the works on
schedule to facilitate the envisaged objectives in reaching the targeted
population. Further, several water supply works and building works were not
completed as funds were not provided leading to expenditure on these works
becoming unfruitful.
77
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
2.3.18
Recommendations
The preparation of budget and the ADDP should be in accordance with
the provision of KPR Act and functioning of DPC should be effective.
Irregular drawal of funds in advance and depositing outside
Government account should be avoided.
ZP should ensure timely approval of action plans of line departments
and provide adequate funds.
Provision of basic infrastructure to schools/PHCs/CHCs needs to be
ensured for economic and social upliftment of society.
Health care should be improved by posting adequate specialists/
doctors.
Rural water supply schemes should be properly planned and
implemented, as envisaged, curtailing delay and cost escalation.
Internal control mechanism needs to be strengthened.
78
Chapter II – Results of Audit
SECTIO ‘B’ – PARAGRAPHS
RURAL DEVELOPMET AD PACHAYAT RAJ
DEPARTMET
2.4
Avoidable payment of rent
Failure of Executive Engineer, Panchayat Raj Engineering Division, Udupi to release
adequate funds in time for construction of Zilla Panchayat office building at Udupi, led
to delay in completion of work and consequent avoidable payment of rent of Rs.30.72
lakh
In order to bring various departments under the jurisdiction of Zilla Panchayat
(ZP) functioning in different places under one roof, Executive Engineer (EE),
Panchayat Raj Engineering Division (PRED), Udupi prepared (February 2003)
a line estimate for the construction of a composite ZP office building costing
Rs.5.70 crore. The State Government, however, accorded (January 2004)
administrative approval for construction of basement and ground floor of the
building at an estimated cost of Rs.99.75 lakh. While according the
administrative approval, it was stated that the available budgetary savings of
Rs.51.22 lakh under building construction would also be utilised for
construction of the building. The estimate was technically sanctioned (June
2004) by the Chief Engineer (CE), Panchayat Raj Engineering (PRE)
Department, Bangalore. The work was entrusted to a contractor at the
negotiated cost of Rs.98.73 lakh. An agreement was entered into (October
2004) and site handed over to the contractor stipulating completion by October
2005.
The work was commenced in October 2004. The Commissioner, Revenue
Department, during inspection of works (November 2004) in Udupi, orally
instructed the PRED to suspend the work and to obtain modified structural
designs from Karnataka Housing Board (KHB). Accordingly, the contractor
was instructed to stop the work (November 2004). Subsequently, the
designs/estimates made available by the KHB (January 2005) could not be
considered for want of funds and inclusion of additional quantities for certain
items of work. The work was finally resumed as per the original design in
July 2005 and the civil works were completed in June 2008 at a cost of
Rs.1.06 crore.
The scrutiny of records revealed that though the ZP exhibited to have a
budgetary savings of Rs.51.22 lakh, it did not release sufficient funds in time
for the construction of the building leading to delayed completion. The ZP
released (March 2005 to July 2008) an amount of Rs.1.13 crore to PRED,
79
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Udupi in a staggered manner. It was also noticed that these releases included
a sum of Rs.20 lakh irregularly diverted by the ZP, out of funds allocated to
Health and Family Welfare Department. Meanwhile, the ZP incurred an
expenditure of Rs.30.72 lakh towards rent for office building for the period
from November 2005 to June 2008.
The ZP occupied (June 2008) the new building after completion of civil works
without electrification. Fresh tenders were called for (June 2008) electrical
works and completed at an expenditure of Rs.8.09 lakh, through another
contractor. Thus, a total expenditure of Rs.1.14 crore was incurred on the
building, the completion of which was prolonged for 32 months beyond the
scheduled date of completion.
The State Government endorsed (July 2008) the reply of the EE, PRED, Udupi
attributing the delay in completion to paucity of funds and consequent nonpayment of bills of contractor. No reasons were furnished by the ZP for its
failure to release funds despite claiming in administrative approval that the
budgetary savings would be utilised towards construction of the office
building. Non-release of adequate funds, in time, by the ZP led to avoidable
additional liability of Rs.30.72 lakh towards rent.
2.5
Delay in completion of a water supply scheme
Failure of Executive Engineer, Panchayat Raj Engineering Division, Chikkodi to
prioritise water supply work components during execution resulted in noncommissioning of a water supply scheme for over four years rendering expenditure of
Rs.2.37 crore unfruitful
The Empowered Committee for Rural Water Supply of the State Government
approved (May 2002) a water supply scheme to Diggewadi and four villages49
of Raibag taluk, Belgaum district under community based Submission
programme with River Krishna as the source. The objective of the
Submission programme was to control brackishness and provide improved and
sustainable drinking water to the rural population. The State Government
accorded administrative approval (June 2003) for the scheme for an estimated
cost of Rs.2.91 crore with a condition to remit the community contribution of
Rs.14.54 lakh already collected for the programme to Zilla Panchayat (ZP)
funds. The Chief Engineer (CE), Panchayat Raj Engineering (PRE)
Department, Bangalore accorded technical sanction (July 2003) to the estimate
of Rs.2.78 crore based on 2002-03 Schedule of Rates. The work was entrusted
to a contractor (August 2003) at a negotiated cost of Rs.2.73 crore with a
stipulation to complete the work by November 2004.
49
Biradi, Jalalpur, Kachakarwadi and Yadrav
80
Chapter II – Results of Audit
The State Government directed (February 2002) that while executing water
supply scheme with river, canal or lake as the source, head works viz., intake
well, jack well, etc., should be undertaken before other items of works viz.,
raising main, distribution lines, etc.
Scrutiny of records revealed that the contractor executed raw water and pure
water raising mains, over head tanks, intermediate sumps, etc., without
considerable progress in head works (May 2005). The progress of work was
tardy since May 2005 and even as of August 2008, the construction of pump
house and erection of pumping machinery remained incomplete after incurring
an expenditure of Rs.2.37 crore.
Based on the instruction of CE, PRE Department, Bangalore to rescind the
contract due to abnormal delay in completion of the scheme, the
Superintending Engineer directed (August 2008) the Executive Engineer (EE),
PRE Division (PRED), Chikodi, Belgaum district to furnish proposals for
rescinding the contract. The EE while stating that the contract was not
rescinded due to involvement of additional expenditure and time, attributed
(August 2008) the delay to heavy rains in the catchment area during 2005-06
and 2006-07 leading to release of excess water from Koyna Dam inundating
the head works area. It was reported by EE (December 2008) that the balance
works were under progress by the same contractor. Had EE scrupulously
followed the circular instructions issued by State Government, the works
relating to head works would have been completed before inundation of the
area thereby ensuring timely completion of the scheme.
Audit further observed the following:
The contractor had procured pumping machineries worth Rs.13.34
lakh (February 2004) with a warranty period of one year which
were yet to be erected even after four years (August 2008).
EE, PRED, Chikodi sought permission from the concerned
authority to draw water from river only in September 2008 at the
instance of audit.
Electrification of the scheme for which a sum of Rs.49 lakh was
released to Grama Panchayat (GP) only in March 2008.
The community contribution of Rs.14.54 lakh collected was
withdrawn (August 2003) from the bank by the then GP Secretary
and President without remitting to the ZP fund. The Chief
Accounts Officer, ZP, Belgaum had furnished a report (December
2008) establishing misappropriation.
81
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Thus, the failure of EE, PRED, Chikkodi in not prioritising the work
components resulted in non-commissioning of the scheme rendering
expenditure of Rs.2.37 crore unfruitful, besides denial of safe drinking water
to five villages.
The matter was referred to State Government in April 2007; reply had not
been received (March 2009).
2.6
Cost and time over run on construction of a bridge
Failure of Executive Engineer, Panchayat Raj Engineering Division, Chikmagalur to
invoke contractual clause resulted in cost escalation of Rs.14.95 lakh. Besides, the
objective of providing connectivity to villages was delayed by more than five years
In order to provide connectivity to villages from Neradi and Tiruguna, the
work of construction of a bridge across Beeranji halla in Baskal village,
Chikmagalur taluk at an estimated cost of Rs. 20 lakh (SR 1999-2000), was
administratively approved by the Chief Executive Officer (CEO), Zilla
Panchayat (ZP), Chikmagalur and technically sanctioned (December 1999) by
the Superintending Engineer (SE), Public Works Department, Hassan Circle,
Hassan. The estimated work of Rs.15.43 lakh was entrusted to a contractor
(September 2000) at the tendered cost of Rs.14.98 lakh with a stipulation to
complete the work by May 2003.
After commencement of work (November 2000), it was noted (March 2001)
by SE, Panchayat Raj Engineering (PRE) Circle, Mangalore that as per
Strength Bearing Capacity (SBC) of the soil, there was necessity to change the
foundation design to RCC raft with curtain walls on both upstream and
downstream. The contractor had requested (March 2001) for the revised
design and drawings for execution of the foundation work accordingly. While
approving the additional work (May 2001), the Chief Engineer (CE), PRE
Department, Bangalore instructed to provide working drawings to the
contractor due to change in design. The extra work estimated at Rs.4.98 lakh
was approved (March 2002) by the CEO, ZP, Chikmagalur a year after SE’s
inspection.
Instead of entrusting the additional work to the contractor by invoking relevant
clauses of the contract, the work was taken up departmentally (August 2003)
and completed (April 2004) after a delay of two years of its approval. Since
the estimated amount was found sufficient only for execution of RCC raft, an
additional estimate of Rs.4.99 lakh was provided for the balance work of
curtain wall for which no tenders were received (July 2006).
82
Chapter II – Results of Audit
CE, PRE Department, Bangalore while scrutinizing the progress of works of
Chikmagalur taluk (August 2007), suggested to explore the possibility of
entrusting the balance work to the original contractor at the prevailing SR
rates. Accordingly, negotiations were held with the contractor and a revised
estimate of Rs.31 lakh was prepared and the balance work of Rs.30.83 lakh
was entrusted to the contractor (January 2008) at the tendered rate of Rs.29.93
lakh with a stipulation to complete the work by January 2009. The contractor
had completed the work and a payment of Rs.24 lakh was made pending final
settlement (January 2009).
Thus, failure of EE, PRED, Chikmagalur to invoke contractual clause of the
agreement to entrust additional work, laxity in work execution coupled with
delay in entrustment of balance work resulted in cost escalation of Rs.14.95
lakh50 besides denial of shortest connectivity to villages for more than five
years.
The State Government endorsed (January 2009) the reply of CEO, ZP,
Chikmagalur which stated that the contractor had completed the work and
further stated that due to loose soil, the foundation design had to be revised.
However, the reply did not explain the reason for not invoking the contractual
clause which led to time and cost over run.
2.7
Short collection of e-tender fees
Failure of Executive Engineers of Panchayat Raj Engineering Divisions to collect
prescribed e-tender fees from the registered contractors for the works put to tender
resulted in loss of revenue of Rs. 3.33 crore
In order to minimise the tender processing time and to ensure competition and
transparency in the tendering system, the State Government accorded
(November 2005) sanction to all Panchayat Raj Institutions (PRIs) to carry out
the tendering process for civil works with an estimated cost of Rupees five
lakh and above through e-tendering process.
A memorandum of
understanding was entered into (November 2005) between the Chief Engineer
(CE), Panchayat Raj Engineering (PRE) Department, Bangalore and
Karnataka Electronics Development Corporation Limited (KEONICS).
The Executive Engineers (EEs) of Panchayat Raj Engineering Divisions
(PREDs) were the tendering authorities for civil works approved in the action
plans of various schemes implemented by the PRIs. The State Government
entrusted EEs, PREDs to collect 0.5 per cent of the estimated cost of work put
to tender towards tender fee from each tenderer, of which 0.25 per cent subject
50
Rs.34.91 lakh – Rs.19.96 lakh
83
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
to a maximum cap of Rs.8,000 was payable to KEONICS towards tender
processing fees and the rest utilised for administrative expenses.
Scrutiny of records and further information collected from seven PREDs
revealed that the EEs of these PREDs did not collect the prescribed tender fees
from the tenderers in respect of works put to tender during the period January
2006 to March 2008 resulting in loss of revenue of Rs.3.33 crore to the PRIs
as given below:
(Rupees in lakh)
1
Panchayat Raj
Engineering
Divisions
Huvina Hadagali
2
Ramanagara
3
Uttara Kannada
4
Sl.
o.
Estimated
cost of
works
530.58
Tender fee
to be collected
Tender fee
collected
Short
collection
6.10
1.95
4.15
3,045.96
39.18
22.76
16.42
1,503.24
32.08
14.03
18.05
Bagalkot
13,720.59
224.88
38.22
186.66
5
Raichur
1,801.84
124.18
47.25
76.93
6
Chikmagalur
1,871.81
12.47
4.17
8.30
7
Chitradurga
3,294.98
37.76
15.06
22.70
25,769.00
476.65
143.44
333.21
TOTAL
The State Government endorsed (October 2008) the reply of the EE, PRED,
Karwar who stated that the CE, PRE Department, Bangalore had instructed the
EEs to reduce the amount charged for tender forms. Audit sought clarification
(November 2008) with regard to changes effected, if any, on the collection of
tender fee from the State Government. It was replied (December 2008) that
the prescribed tender fee continued to remain at the same rate and the services
of KEONICS had been extended for a further period of three years with effect
from November 2008. Hence the action of EEs in not collecting the
prescribed tender fees was without sanction of State Government which
resulted in revenue loss of Rs.3.33 crore.
2.8
Avoidable extra liability on road works
Failure of Executive Engineer, Panchayat Raj Engineering Division, Chamarajanagar to
follow prescribed tendering procedure led to extra liability of Rs.43.81 lakh besides
accepting fake bank deposit receipts for Rs.3.60 lakh
The Empowered Committee for Pradhan Mantri Gram Sadak Yojana
(PMGSY), Government of India approved (August 2005) the project proposal
for execution of two road works51 under the jurisdiction of Zilla Panchayat
(ZP), Chamarajanagar. The State Government accorded administrative
51
From Hosapura to T-12 under package number KN-08-09 and Chikmole to T-08 under
package number KN-08-10A
84
Chapter II – Results of Audit
approval for the works in September 2005. The estimates were technically
sanctioned (December 2005 and February 2006) by the Chief Operating
Officer, Karnataka Rural Road Development Authority (KRRDA), Bangalore
for Rs.121.75 lakh and Rs.57.65 lakh respectively. Accordingly, the tender
notifications were issued (December 2006) by the Executive Engineer (EE),
Panchayat Raj Engineering Division (PRED), Chamarajanagar. The details of
location, length, amount put to tender, negotiated cost, etc., of works were as
shown in the table below.
Proposed
connectivity
Hosapura
to
T-12
Chikmole
to
T-08
Amount
put to
tender
Length
(in
kilometers)
Estima
ted cost
Gundlupet
7.98
121.75
117.11
Chamarajanagar
3.06
57.65
56.24
ame of the
taluk
Work
entrust
ed on
Scheduled
date of
completion
179.15
June
2007
March
2008
82.34
June
2007
March
2008
egotiated cost
(Rupees in lakh)
Both the works were entrusted to a single contractor at negotiated rates and
agreement entered into (June 2007) with a stipulation to complete the work
within nine months. An amount of Rs.14 lakh was paid (June 2007) to the
contractor as mobilisation advance. The contractor, however, did not
commence the work nor responded to the notices issued by the EE.
Audit scrutiny of the records relating to these two road works revealed that the
EE, PRED, Chamarajanagar entrusted the works without adhering to the
conditions prescribed in the tender documents as follows:
According to tender notification, only Class-I contractors were eligible
for participating in the bidding. Verification by Audit, however,
disclosed that the work was awarded to a Class-II contractor.
The earnest money deposit (EMD) for Rs.3.60 lakh furnished in the
form of bank deposit receipt by the contractor was found to be fake.
Mobilisation advance of Rs.14 lakh was paid by the EE to the
contractor without obtaining the bank guarantee, in disregard of the
stipulations of Standard Bidding Document for PMGSY and
instructions issued (August 1981) by Finance Department.
EE did not obtain the required performance security from the
contractor at the stipulated rate of 5 per cent of the cost of the works.
The prescribed certificate from the chartered accountant of the
contractor showing the financial status and turnover of the contractor
in the past five years was not on record.
85
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
No documentary evidence was available on record in justification of
contractor’s eligibility to execute works under PMGSY (as stipulated
in the Standard Bidding Document).
The agreements were rescinded (March 2008) and on re-tendering, the work
was entrusted (May 2008) to two different bidders at their agreed rates of
Rs.2.10 crore and Rs.95.30 lakh respectively. The extra liability on retendering worked out to Rs.30.85 lakh and Rs.12.96 lakh respectively. As of
January 2009, the works were still in progress.
Thus, the failure of the EE, PRED, Chamarajanagar to follow prescribed
tendering procedure coupled with non-compliance with clauses of Standard
Bidding Document for PMGSY facilitated the contractor in procuring the
works on production of fake bank deposit receipts of Rs.3.60 lakh besides
defrauding the exchequer of a sum of Rs.14 lakh. It also resulted in extra
liability of Rs.43.81 lakh as the works were subsequently entrusted to other
contractors at higher rates. The matter calls for detailed investigation.
The matter was referred to State Government in January 2009; reply awaited
(March 2009).
It was also observed during scrutiny of records of EE, PRED, Mysore that the
same contractor was awarded (January 2007) a work relating to provision of
drinking water supply scheme to Talakadu Grama Panchayat at a tendered cost
of Rs.2.29 crore with the stipulation to complete the work by October 2007.
The work was awarded to the contractor who was Class-II contrary to the
stipulations of tender notification for a Class-I contractor. The contractor
abandoned the work (December 2007) after showing a financial progress of
Rs.11.96 lakh. The work was retendered (October 2008) and was yet to be
awarded (March 2009).
As in the previous case, the EMD for Rs.5.50 lakh furnished by the contractor
in the form of bank deposit receipt was also found to be fake on verification
by Audit.
86
Chapter II – Results of Audit
2.9
Unfruitful expenditure on a water supply scheme
Failure of Zilla Panchayat, Bellary in assessing the condition of the raw water raising
main prior to entrustment of work coupled with delays by Executive Engineer/Chief
Engineer in obtaining approval from State Government and entrustment of work after
re-tendering led to unfruitful expenditure of Rs.92.80 lakh besides cost escalation of
Rs.4.95 crore
With a view to provide safe drinking water to fluoride affected Mariyammana
halli (MM Halli) and seven other villages, the Chief Executive Officer (CEO),
Zilla Panchayat (ZP), Bellary accorded (December 2003) administrative
approval for a community based water supply scheme under Sector Reform
Programme for an estimated cost of Rs.2.99 crore [estimate prepared by
Karnataka Land Army Corporation (KLAC)].
The main work components of the scheme inter alia included repairs to the
existing raw water raising main, construction of water treatment plant,
overhead tanks, distribution pipe lines, pump house and pumping machineries,
etc. The ZP, Bellary entrusted (December 2003) the work to KLAC without
entering into any agreement, but instructed to obtain technical sanction from
the competent authority. The work was scheduled for completion by June
2004. The KLAC commenced (December 2003) the work without obtaining
the technical sanction, as required. The Grama Panchayat (GP), MM Halli
released Rs.74 lakh (December 2003) including community contribution of
Rs.24 lakh to KLAC. A sum of Rs.25 lakh was further released (August
2005) by GP, MM Halli to KLAC.
During execution (July 2005) the KLAC noticed that major portion (almost 80
per cent) of the existing raw water raising main was corroded and needed
replacement in full. A separate proposal for the replacement of raw water
raising main at a cost of Rs.2.63 crore was approved by State Government
(March 2006) and the stipulated date of completion was extended upto
October 2006. As the progress of work was tardy, the work was withdrawn
(December 2006) from KLAC and entrusted to the Panchayat Raj Engineering
(PRE) Sub-Division, Hospet. The KLAC handed over the work (February
2007) to Sub-Division after completing civil works of pump house, water
treatment plant, overhead tanks and distribution lines up to MM Halli
incurring a total expenditure of Rs.92.80 lakh. Though the estimated cost of
the scheme was revised (including new raw water raising main) to Rs.5.61
crore in March 2006, it was submitted by Chief Engineer (CE), PRE
Department to State Government for approval in June 2007, after a delay of
more than nine months.
87
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
In the meantime, Executive Engineer (EE), PRE Division, Bellary invited
(February 2007) short term tender for the remaining works of Rs.4.21 crore.
The work could not be awarded to the sole tenderer as EE/CE failed to decide
awarding of contract within the validity period (January 2008) of the tender.
Reasons for the delay were not forthcoming from the records. The estimated
cost of the work was further revised (June 2008) to Rs.7.94 crore due to
escalation in cost of pipes.
Thus, the failure of ZP, Bellary in assessing the condition of the existing raw
water raising main prior to entrustment of work coupled with delays by EE/CE
in obtaining approval from State Government and entrustment of work after
re-tendering led to unfruitful expenditure of Rs.92.80 lakh, besides cost
escalation of Rs.4.95 crore52 (more than 265 per cent of the original estimate).
This had also resulted in depriving the envisaged safe drinking water to the
rural population even after five years.
The matter was referred to State Government (October 2008), reply awaited
(March 2009).
2.10
Unfruitful expenditure on construction of a bridge
Failure of Executive Engineer, Panchayat Raj Engineering Division, Belgaum to conduct
detailed survey before original estimate and to take possession of the land before
commencement of work of the bridge rendered expenditure of Rs 25.40 lakh unfruitful
The work of construction of a bridge across Malaprabha river at Kanjale
village in Khanapur taluk, Belgaum district was administratively approved by
State Government in September 2004. The Chief Engineer (CE), Panchayat
Raj Engineering (PRE) Department, Bangalore accorded technical sanction in
November 2004 for an estimated cost of Rs.32 lakh (SR 2002-03). Tenders
were called for and the work was entrusted (January 2005) to a contractor at
the negotiated rate of Rs.30.30 lakh. The site was handed over to the
contractor (February 2005) with a stipulation to complete the work within nine
months excluding monsoon period.
The Superintending Engineer, PRE Circle, Belgaum on site inspection
(February 2005) suggested shifting the site 50 meters upstream of the river due
to technical reasons and accordingly the design and estimate was revised to
Rs.34.80 lakh (SR 2002-03) which was approved (June 2005) by CE, PRE
Department, Bangalore. Shifting of site of bridge necessitated acquisition of
land for approach road. During execution, one of the land owners objected
and approached the court of law (April 2005). The Court (January 2006)
52
Rs.7.94 crore – Rs.2.99 crore
88
Chapter II – Results of Audit
restrained the Department from carrying out work in the suit property and
directed to follow due procedure for acquisition of land. The land
compensation award was passed only in January 2008. As of March 2009, the
work of laying a deck slab, providing side handrails and approach on one side
of the bridge remained incomplete, incurring an expenditure of Rs. 25.40 lakh.
Audit scrutiny revealed that the original estimate had been prepared after site
inspection (November 2004). However, the revised estimate was justified on
the ground that while the original estimate was based on preliminary survey,
the revision was based on detailed construction survey leading to shifting of
location of bridge and revision of design necessitating acquisition of land.
Also the Executive Engineer, PRE Division, Belgaum did not take possession
of the land before commencement of work resulting in delay in execution. As
a result of the above failures, expenditure of Rs 25.40 lakh remained unfruitful
besides depriving connectivity to rural population for more than three years.
The State Government endorsed the reply (January 2009) of Chief Executive
Officer, Zilla Panchayat, Belgaum stating that the delay in completion was due
to abnormal rains at the site but did not explain as to why detailed survey was
not conducted prior to commencement of work.
RURAL DEVELOPMET AD PACHAYAT RAJ
DEPARTMET
AD
AGRICULTURE AD HORTICULTURE DEPARTMET
2.11
Injudicious implementation of a watershed project
Failure of Zilla Panchayat, Dharwad to ensure the jurisdictional status of the Unkal subwatershed villages for implementation of Sujala Watershed project defeated the purpose
of the project after incurring an expenditure of Rs. 66.80 lakh
In order to enhance sustainable agricultural growth with better management of
land and water resources, Unkal sub-watershed comprising six micro
watersheds under Zilla Panchayat (ZP) Dharwad was considered by State
Government for implementation of Sujala Watershed Project (Project) with
World Bank assistance under phase-III at an estimated cost of Rs. 2.46 crore
during 2003-04. The Project aimed at raising agriculture productivity, both
through in-situ soil and moisture conservation and rain water harvesting to
augment groundwater resource, forest cover, livestock and fodder
management, income generating activities, etc.
89
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
The Chief Executive Officer (CEO), ZP, Dharwad was responsible for
approval of sub-watershed development plans, routing of funds to the
executing agency, review and monitoring of Project performance through ZP
Standing Committee. The work was entrusted to India Development Service
(IDS), Dharwad, a non-governmental organisation (NGO) during March 2004.
Out of the targeted area of 2,790 Hectares (Ha) of land available for
development, only 1,082.90 Ha was focused for treatment under the Project.
The District Project Coordinator (DPC), IDS, Dharwad achieved progress in
treatment of 954.27 Ha of land (November 2006). It was observed that there
was considerable reduction in treatable area for watershed due to farmers
inclination to convert their agricultural land for non-agricultural purposes
fetching competitive rates. Therefore, the DPC, expressed opinion (October
2006) to the Project Officer (PO) and District Watershed Development Officer
(DWDO), Dharwad that there was limited scope for land-based activities in
Unkal sub-watershed. PO and DWDO, Dharwad suggested (December 2006)
to the Commissioner and Project Director, Bangalore for closure of the Project
with provision for withdrawal strategy. Accordingly, the Project was closed
(February 2007) after incurring an expenditure of Rs.66.80 lakh as of
November 2008.
Scrutiny revealed that the six villages wherein the Project was implemented
were notified areas (October 1995) under the jurisdiction of Hubli-Dharwad
Municipal Corporation (HDMC). Hence, implementation of the Project by
ZP, Dharwad in peri-urban areas where agriculture was not a need-based
occupation and expenditure of Rs.66.80 lakh were injudicious.
The matter was referred to State Government (August 2008) and the
Commissioner and Project Director, Sujala Watershed Project, Bangalore
replied (August 2008) that the Unkal sub-watershed Project was conceived
during 2001-02 and there was no proposal then for conversion of treatable
land for non-agriculture purposes. The reply is not tenable as State
Government had included these villages in HDMC in 1995 itself.
90
Chapter II – Results of Audit
RURAL DEVELOPMET AD PACHAYAT RAJ
DEPARTMET
AD
HEALTH AD FAMILY WELFARE DEPARTMET
2.12
Laxity in construction of a primary health centre
Failure of Zilla Panchayat, Dharwad to consider the request of public and its vacillation
in entrusting the work resulted in delay in completion of a primary health centre
building rendering the expenditure of Rs.13 lakh unfruitful besides denial of envisaged
health care facilities to rural poor
In order to provide health facilities to the rural poor, State Government
sanctioned (September 1998) 75 Primary Health Centres (PHCs) to villages
under various Zilla Panchayats (ZPs) with a stipulation that priority should be
accorded to villages which made available a minimum of two acres of land.
The list included a PHC for Yeraguppi village in Kundagol taluk under ZP,
Dharwad. On the request of the Grama Panchayat (GP) (March 2002), Deputy
Commissioner, Dharwad allotted (September 2003) two acres of Government
land near the village tank. An amount of Rs.15.62 lakh was provided in
2003-04 to the Panchayat Raj Engineering Division (PRED), Dharwad for
taking up the work.
Scrutiny of records revealed that the villagers of Yeraguppi had represented
(December 2003) against the construction of hospital building on the said site
apprehending pollution through hospital waste to tank water which was being
used for drinking purpose. Inspite of the objection, the ZP decided (January
2004) to entrust the work to Karnataka Land Army Corporation (KLAC) for
speedy completion and accorded (March 2004) administrative approval.
KLAC technically sanctioned (March 2004) the work for Rs.29.98 lakh and
took possession of the site in January 2005 with target date of completion of
work as March 2006. The work was stopped in April 2005 after an
expenditure of Rs.0.65 lakh, as Yeraguppi GP passed a resolution not to
construct the building in the site near the tank. A stay order in this regard was
also obtained by villagers (April 2005) from the Civil Judge (Junior Division)
and Judicial Magistrate First Class Court, Kundgol.
The work was shifted (October 2005) to a new site received as donation by the
Health Department. The work was again stopped (February 2006) as there
was an objection from another section of public for construction. The State
Government finally decided (May 2006) to continue construction at the new
site. The site was handed over to KLAC (July 2006) and construction
resumed. It was noticed in audit that even though there was no progress in the
91
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
construction, the ZP released Rs.24.35 lakh during 2004-06, which was
irregularly diverted by KLAC for the works of Hubli-Dharwad Municipal
Corporation. A sum of Rs.13 lakh was further released (October 2006) out of
interest bearing loan from NABARD under Rural Infrastructure Development
Fund – XI Scheme. As of March 2007, KLAC had incurred expenditure of
Rs.13 lakh on the building with a physical progress up to plinth level.
Meanwhile, the ZP decided (May 2007) to withdraw the work from KLAC
and entrust the same to PRED, Dharwad. Though KLAC handed over
(August 2007) the site to PRED, the unspent amount of Rs.24.35 lakh was
returned only during April 2008. Due to efflux of time, the estimated cost of
the work was escalated to Rs.38 lakh.
Thus, failure of ZP, Dharwad to consider the request of public and its
vacillation in entrusting the work between the construction agencies resulted
in the building remaining incomplete after incurring an expenditure of Rs.13
lakh besides denial of envisaged health care facilities to rural poor even after
10 years of sanctioning the PHC.
The State Government endorsed the reply of Executive Engineer, PRED,
Dharwad (October 2008) stating that the tendering was in progress and the
building would be completed and handed over to the user department. It was,
however, noticed that the PRED entrusted the balance work to another
contractor at the agreed cost of Rs. 48 lakh only during February 2009 with a
stipulation to complete the work by November 2009.
RURAL DEVELOPMET AD PACHAYAT RAJ
DEPARTMET
AD
SOCIAL WELFARE DEPARTMET
2.13
Wasteful expenditure due to abandonment of a hostel
building
Failure of Executive Engineer, Panchayat Raj Engineering Division, Koppal in
preparing estimate for construction of a hostel building considering the site condition led
to wasteful expenditure of Rs.19.98 lakh.
State Government accorded (March 1996) administrative approval for
construction of pre-matric girls hostel building at Alwandi in Koppal taluk
(then under the jurisdiction of Zilla Panchayat (ZP), Raichur) for an estimate
of Rs.19.98 lakh. Executive Engineer (EE), Panchayat Raj Engineering
Division (PRED), Koppal prepared the estimates for the building which was
technically sanctioned (November 1995) by the Superintending Engineer,
92
Chapter II – Results of Audit
PWD Circle, Bellary. The land for construction was identified by the
Department of Backward Classes and Minorities (BCM) and handed over to
PRED. The work commenced in August 1996 and civil works were
completed during December 1999. However, the building was handed over to
the user department and made functional only during February 2001 on
completion of water supply and electrical works at a total expenditure of
Rs.19.98 lakh.
During October 2003, the Department of BCM reported to the EE, PRED,
Koppal that the building had developed cracks in walls and was found unsafe
to house the students. The EE, PRED, Koppal who inspected (May 2004) the
building, opined that the damage to the building was due to foundation
problems. On the instruction of the EE (June 2004), M/s. Torsteel Research
Foundation of India (TRFI), an independent agency, was requested to
investigate the reason for damage to the building. The TRFI reported
(September 2004) that the building was situated adjacent to a stream and the
area around the building was prone to inundation and stagnation of water
during rains leading to swelling and shrinkage of expansive soil over which
the building was constructed. The TRFI further reported that absence of storm
water drainage and plinth protection had aggravated the distress caused to the
building which could not be totally eliminated or prevented through
restoration measures. Evidently, the estimate prepared by EE, PRED, Koppal
was without considering the soil condition, other essential protective
measures, etc., which was defective.
The building was abandoned in June 2007 and the inmates of the hostel were
shifted to a rented building incurring additional liability of Rs.1.07 lakh
towards rent as of March 200953. The District Officer, BCM, Koppal stated
(July 2008) that a new building was being constructed, adjacent to the
abandoned hostel building to house the inmates.
The State Government endorsed (January 2009) the reply of EE, PRED,
Koppal that the building was constructed on a land having black cotton soil
and heavy rainfall during September 2001 which breached a nearby tank
causing stagnation of water around the building for long. Consequently,
cracks developed due to swelling of load bearing foundation which was
beyond control.
53
@ Rs.5,100/- per month from June 2007
93
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
The reply is not acceptable for the following reasons:
PRED was aware of the fact that the site was located in black cotton
soil and adjacent to a stream; accordingly the estimate/design was
required to be prepared with adequate provisions.
In spite of release of Rs.1.10 lakh (April 2004) for repair works to EE,
PRED, Koppal, action to drain out stagnated water was not taken up as
seen from the records made available.
The school and hospital buildings situated nearby were not affected
due to heavy rains as reported by the Chief Executive Officer, ZP,
Koppal.
Thus, failure of the EE, PRED, Koppal in preparing estimate considering the
site condition rendered the expenditure of Rs.19.98 lakh wasteful.
2.14
on-completion of an irrigation scheme
Failure of Executive Engineer, Panchayat Raj Engineering Division, Chamarajanagar to
complete the work components of a lift irrigation scheme rendered expenditure of
Rs.23.08 lakh unfruitful besides denial of irrigation facilities to the rehabilitated tribal
population
In order to provide irrigation facilities to about 200 rehabilitated tribal families
of Kaniyanapura village, Gundlupet taluk, Chamarajanagar a Lift Irrigation
Scheme (LIS) was proposed (August 2000) by the Director, Tribal Welfare
Department for irrigating 250 acres of land. The work included construction
of pick up54, intake well, approach channel, jack well, pump house, raising
mains, delivery chamber and pumping units. Administrative approval for the
work was accorded (December 2001) by the State Government and the
estimate for Rs.54.60 lakh (SR 2002-03) prepared by the Executive Engineer
(EE), Panchayat Raj Engineering Division (PRED), Chamarajanagar was
technically sanctioned (November 2003) by the Chief Engineer (CE),
Panchayat Raj Engineering (PRE) Department, Bangalore. The work was
entrusted to a contractor (July 2004) at the negotiated cost of Rs.47.84 lakh
with a stipulation to complete the work by July 2005.
The contractor after completing the pick up and apron at down stream
abandoned the work (January 2006). A claim of Rs.23.08 lakh was admitted
and paid during June 2006 by levying a nominal penalty of Rs.10/- per day for
the delay in execution.
54
a barrier constructed across a river/stream for storage of water
94
Chapter II – Results of Audit
In July 2007, the land on one side of the pick up got eroded due to nonprovision of protective works as opined by Superintending Engineer during his
visit to the work spot (January 2005) and consequently no water could be
stored on the up stream of the pick up, defeating the primary requirement for
lift irrigation.
The balance work estimated at Rs.22.49 lakh (SR 2002-03) was revised to
Rs.33.31 lakh (SR 2007-08) with a cost escalation of Rs.10.82 lakh. Approval
for draft tender notification for the balance items of work was accorded by CE
during June 2007. The work was entrusted (February 2008) to another
contractor after a delay of two years of its abandonment by the first contractor,
at a negotiated rate of Rs.32.20 lakh with a stipulation to complete the work by
August 2008. As of September 2008, no bill was submitted by the contractor
even after the expiry of stipulated date of completion.
Audit observed during a joint physical verification (October 2008) that the
remaining works such as raising main, delivery chamber, feeder channel,
pumping machinery etc., were yet to be taken up. In reply to audit (October
2008), it was stated by the Assistant Executive Engineer, PRE Sub-Division,
Gundlupet that 300 mm dia pipes proposed for raising main in the estimate
was not available in the market and proposal to consider 450 mm dia pipes
would be forwarded to CE along with additional estimate including protective
works which were very essential.
The matter was referred to State Government in November 2008 and the State
Government endorsed the reply (January 2009) of the Chief Executive Officer,
ZP, Chamarajanagar wherein it was stated that the work was under progress
and would be completed including the protective works. However, reasons for
95
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
delay of more than six months from due date for completion even by the
second contractor were not explained (March 2009).
Thus, failure of Executive Engineer, PRED, Chamarajanagar to expedite
completion of the work components of a lift irrigation scheme coupled with
scouring of land on one side of the pick up rendered the expenditure of
Rs.23.08 lakh unfruitful besides denial of irrigation facilities to the
rehabilitated tribal population of Kaniyanapura for more than three years.
GEERAL
2.15
Follow-up action on Audit Reports
According to the Hand Book of Instructions for speedy settlement of audit
observations, etc., issued by the Finance Department and the Rules of
Procedure (Internal Working) of the Public Accounts Committee, the
departments of State Government should prepare and forward to Karnataka
Legislative Assembly Secretariat, detailed explanations in the form of Action
Taken Notes (ATNs) on the paragraphs/reviews featured in the Reports of the
Comptroller and Auditor General of India within four months of the
presentation of the Reports in the Legislature, duly getting the ATNs vetted by
Audit.
ATNs have, however, not been received by Audit for 29 paragraphs even as of
March 2009. The department-wise position of pendency is furnished in the
Appendix 2.6. The details of presentation of the Reports of the Comptroller
and Auditor General of India (Panchayat Raj Institutions) to the State
Legislature and ATNs due are given below:
Audit Report for the
year ending
2006
Month of presentation to the
Legislature
July 2007
2007
July 2008
umber of ATs due
14
15
While the above Reports presented to the State Legislature featured audit
comments noticed during the review of implementation of various schemes
and serious irregularities like misappropriation of funds/stores, delay in
completion of schemes/buildings leading to idle investments, unfruitful/
irregular/infructuous expenditure etc., the State Government had not
communicated (March 2009) details of action taken to plug the loop holes in
the system that led to these financial improprieties. The departments
concerned need to be instructed to forward the ATNs on the
96
Chapter II – Results of Audit
paragraphs/reviews featured in these Audit Reports to the Karnataka
Legislature without undue delay.
2.16
Poor response to Inspection Reports
The Karnataka Zilla Panchayat (Finance and Accounts) Rules stipulate that
Head of the Departments/Drawing and Disbursing Officers of the Zilla
Panchayat (ZPs) shall attend promptly to the objections issued by the
Accountant General. It is further stipulated that the ultimate responsibility for
expeditious settlement of audit objections lies with Chief Executive Officer of
ZPs. Despite Ad-hoc Committee meetings being held regularly, 3,933
Inspection Reports consisting of 15,131 paragraphs were outstanding in
various ZPs, as of March 2008. During the year 2007-08, 3,731 paragraphs
were cleared in 24 meetings held. Year-wise details of reports and paragraphs
outstanding in respect of all the ZPs are detailed in Appendix 2.7. Out of the
Inspection Reports outstanding, 2,545 (65 per cent) reports containing 7,440
(49 per cent) paragraphs were pending for more than five years, indicating that
the action taken by the CEOs for settlement of objections was not adequate.
BAGALORE
The
(USHA SAKAR)
Principal Accountant General
(Civil and Commercial Audit)
COUTERSIGED
EW DELHI
The
(VIOD RAI)
Comptroller and Auditor General of India
97
Appendices
Appendix 1.1
Statement showing non-transfer of functions to PRIs
(Reference : Paragraph 1.7.1.1 / Page 14 )
Sl.
o.
Subject
Functions transferred
o. of
Functions
ZP
TP
GP
Functions not transferred
ZP
TP
GP
01
Agriculture including extension
48
15
19
14
-
-
-
02
Land Improvement, Soil
Conservation
48
14
17
17
-
-
-
03
Minor Irrigation, Watershed
46
13
16
17
-
-
-
04
Animal Husbandry
38
05
10
08
05
05
05
05
Fisheries
40
15
13
12
-
-
-
06
Social Forestry
20
08
05
07
-
-
-
07
Minor Forest produce
22
03
02
01
08
03
05
08
Small Scale Industries
15
03
01
-
03
06
02
09
Khadi, Village & Cottage Industry
33
08
03
05
05
10
02
10
Rural Housing including IAY
10
01
02
07
-
-
-
11
Drinking water
15
05
03
07
-
-
-
12
Fuel and Fodder
12
02
01
09
-
-
-
13
Roads, Culverts, Bridges, etc.
32
13
11
08
-
-
-
14
Rural Electrification including
distribution
10
03
01
04
-
01
01
15
Non-conventional Energy
13
04
05
04
-
-
-
16
Poverty alleviation programme
61
25
19
17
-
-
-
17
Education including Primary
Education and Secondary School
16
05
05
06
-
-
-
18
Technical Training
11
06
04
-
-
-
01
19
Adult and Non-formal Education
10
05
02
03
-
-
-
20
Libraries
07
02
01
04
-
-
-
21
Cultural activities
10
05
02
02
01
-
-
22
Markets and fairs
11
04
05
01
-
-
01
23
Health and Sanitation
24
09
07
08
-
-
-
24
Family Welfare
28
15
07
06
-
-
-
25
Women & Child development
50
18
13
19
-
-
-
26
Social Welfare-including welfare of
the handicapped and mentally
retarded
96
41
48
05
-
-
02
TOTAL
726
247
222
191
22
25
19
101
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Appendix 1.2
Functions envisaged in the Activity Map but not transferred to PRIs
(Reference : Paragraph 1.7.1.1 / Page 14 )
Sl.o.
Subject/Activity
Functions
ZILLA PACHAYATS
1.
2.
Animal Husbandry
Feeding & Fodder
Nutritive fodder, establishment of fodder banks.
Dairy Development
Assist cooperatives in the development of infrastructure for milk collection,
transporting and processing.
Poultry Development
Infrastructure for poultry farming, production and supply of quality
chicks to poultry farmers, allotment/leasing of community land for
establishing poultry complexes.
Minor Forest Produce
Regeneration of species
Planning Minor Forest Produce (MFP) plantations, encouraging
cultivation of MFP in existing forests, encourage plantations of MFP
such as gum, resin, oil seeds, etc., plantation of MFP in drought
areas.
Training of tapping of gums, resins, etc., and grading.
Monitoring of MFP collection, timely payment of collection.
Setting up of SSI units for value addition of MFP, fixing of
supporting price, godowns for storage, market extension activities.
Training
MFP collection
Processing and Marketing
3.
Small Scale Industries
Infrastructure Development
Developing inter-linkages of institutions and organisations,
establishment of small industrial estates, development of food
processing complexes.
Providing guidance about credit facilities and other financial
incentives and coordination of credit support activities.
Credit, financial assistance
4.
Khadi, Village & Cottage Industries
Training, skill development
Establishment of Training Centers for skill development
Infrastructure Development & Credit Financial
support
5.
Cultural activities
Promotion of cultural activities
Supply of raw materials, equipment and other inputs, setting up of
retail showrooms. Credit plan preparation, supervision of credit flow
and financial assistance. Providing guidance about credit facilities.
Coordination of credit support activities.
Maintenance and supervision of Nehru Yuva Kendras.
TALUK PACHAYATS
1.
2.
Animal Husbandry
Dairy Development
Poultry Development
Minor Forest produce
Regeneration of MFP species
Training
Processing & Marketing charges
Development and opening of new milk routes for milk collection,
promotion of milk production, ensuring timely payment to milk
producers. Supply of quality milch animals.
Training of poultry farmers, supply of poultry feeds.
Establishment of nurseries for MFP species.
Organising training at Taluk Panchayat level.
Constitution of Joint Forest Management Committee with Forest
Department, ensuring value addition to MFP.
Contd……
102
Appendices
Sl.o.
Subject/Activity
3.
Khadi, Village and Cottage Industries
Planning, Monitoring and Supervision
Functions
Training, skill development and transfer of
technology to beneficiaries
Infrastructure development
Credit and financial support
4.
5.
Credit and financial assistance from State
Government departments and agencies
Small Scale Industries
Industrial Resource Potential Survey
Development of Infrastructure
Entrepreneur development
Rural Electrification including distribution
Preparation of Plan for Khadi Village & Cottage Industries, other
artisan activities.
Selection of beneficiaries for Training and Skill development,
arrange master craftspersons. Transfer and upgradation of
technology.
Supply of raw materials, equipment and other inputs to
beneficiaries, coordination of infrastructure development plans,
construction of worksheds and market complexes, organising the
cooperatives for production and marketing.
Providing credit support, assisting in project plan formulation,
arrangement of subsidy and financial support, monitoring of
progress.
Assist in providing financial assistance.
Assisting in Industrial Resource Potential survey.
Establishing small rural industrial estates and complexes.
Organising entrepreneurial development programmes, selection of
entrepreneurs, establishing industrial counselling and guiding
centers. Assist entrepreneurs in formulating viable projects.
Monitoring and reporting progress of energisation of irrigation
pumpsets.
GRAMA PACHAYATS
1
2.
Animal Husbandry
Veterinary services Feeding and Fodder
Minor Forest Produce
Regeneration of MFP species
Training
Processing and marketing charges
3.
4.
Small Scale Industries
Industrial Resource Potential Survey
Development of Infrastructure
Khadi, Village and cottage Industries
Planning, Monitoring and Supervision
Infrastructure
5.
Rural Electrification including distribution
6.
Technical Training and Vocational
Education
Promotion of Vocational Courses
7
8.
Markets and Fairs
Development of Market yards
Social Welfare
Drug prevention
Supervision of Rural Livestock Unit Service Centers.
Help in establishing cooperative fodder farm, allocation of
community land for fodder production, controlling grazing,
distribution of fodder droughts.
Identification of families willing to plant MFP species, distribution
of MFP seedlings.
Selection of Trainees.
Promotion of primary processing and value addition to MFP
species, ensuring timely payment to MFP collectors.
Assisting in survey and project formulation.
Identification of suitable locations for rural industries.
Assisting Taluk Panchayats in identifying potential activities and
formulation of projects.
Assisting in distribution of raw material, equipment etc.,
construction of common worksheds/work places and market
complexes.
Land acquisition for installing/erecting electrification transmission
poles
Assist in identification of eligible candidates for vocational
training.
Construction of market complexes within the Grama Panchayat.
Rehabilitation of drug addicts, take drug addicts to counselling/
de-addiction centers.
103
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Appendix 1.3
Allocation for procurement of medicines for health institutions of PRIs
(Reference : Paragraph 1.7.2/ Page 16 )
(Rupees in lakh)
Year
Total
allocation
To be
allocated
Actually
allocated
To be
allocated
Actually
allocated
Reduced
allocation to ZP
sector
(Col.3-4)
ZP sector (60%)
State sector (40%)
Percentage of
reduced
allocation to ZP
sector
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
2005-06
2,101.60
1,260.96
1,149.90
840.64
951.70
111.06
09
2006-07
2,400.04
1,440.02
880.83
960.02
1,519.21
559.19
39
2007-08
2,627.02
1,576.21
924.86
1,050.81
1,702.16
651.35
41
104
Bangalore (Rural)
Belgaum
Bellary
Bijapur
Chikmagalur
Chitradurga
Dharwad
Dakshina Kannada
Kolar
Koppal
Mysore
Raichur
Shimoga
2
3
4
5
6
7
8
9
10
11
12
13
14
49
7
1
22
NF
3
1
2
3
1
3
3
1
1
1
umber of
Departmental
Officers
303
46
1
NF
26
NF
18
4
9
5
63
13
29
88
1
umber of DC
bills pending
105
463.82
36.71
28.97
298.19
5.45
2.84
6.01
0.20
1.93
1.73
9.73
3.73
56.25
1.26
10.82
Amount
(Rupees in lakh)
ZP - Mandya did not furnish the required information and other ZPs furnished as ‘Nil’.
NF - Not Furnished
Total
Bagalkot
Zilla Panchayat
1
Serial
umber
-
1991-92
1993-94
1987-88
1999-2000
2006-07
2001-02
2007-08
2005-06
2006-07
1986-87
2007-08
2007-08
1987-88
2005-06
Earliest year from
which pending
on-submission of accounts for amounts drawn on Abstract Contingent Bills
(Reference: Paragraph 1.8.3 / Page 17)
Appendix 1.4
Appendices
-
7
Belgaum
Bijapur
Chitradurga
Gadag
Hassan
Raichur
Tumkur
Udupi
Uttara Kannada
TOTAL
2
3
4
5
6
7
8
9
10
80.63
-
22.43
-
2.13
-
-
7.72
48.35
-
7
-
-
1
-
1
1
1
-
2
161.30
-
-
6.25
-
10.23
72.31
5.15
-
61.85
Roads & Bridges
umber Expenditure
1
5.51
9
1
-
-
-
-
-
2
1
5
106
403.42
326.11
-
-
-
-
-
1.23
21.96
54.12
Water Supply works
umber
Expenditure
-
ZP - Mandya did not furnish the required information and other ZPs furnished as ‘Nil’.
2
-
2
-
-
2
1
-
Bangalore (Rural)
Zilla Panchayat
Buildings
umber Expenditure
-
Sl.
o.
1
Appendix 1.5
List of incomplete works
(Reference: Paragraph 1.9 / Page 18)
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
5
-
-
-
-
-
-
-
-
5
33.03
-
-
-
-
-
-
-
-
33.03
Swachcha Grama works
umber
Expenditure
-
28
1
2
1
2
1
1
5
2
12
678.38
326.11
22.43
6.25
2.13
10.23
72.31
14.10
70.31
149.00
(Rupees in lakh)
Total
umber Expenditure
1
5.51
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
Sl.
o.
Under investigation
umber
Amount
5
25.51
6
11.38
8
22.45
14
80.54
15
23.28
12
87.40
21
34.02
42
112.84
35
61.68
1
6.21
4
406.32
27
103.28
27
137.05
3
7.87
30
280.44
7
26.42
8
48.49
4
59.38
269
1,534.56
ZP - Mandya did not furnish the required information
Bagalkot
Bangalore (Rural)
Bangalore (Urban)
Bellary
Bidar
Bijapur
Belgaum
Chamarajanagar
Chikmagalur
Chitradurga
Dakshina Kannada
Davanagere
Dharwad
Gadag
Gulbarga
Hassan
Haveri
Kodagu
Kolar
Koppal
Mysore
Raichur
Shimoga
Tumkur
Udupi
Uttar Kannada
TOTAL
Zilla Panchayat
107
Pending in court
umber
Amount
1
2.43
13
103.28
1
0.95
1
1.02
6
20.00
1
1.80
6
53.18
1
0.45
2
7.88
5
70.41
1
206.49
1
0.66
5
88.57
2
4.59
1
5.23
47
566.94
Others
umber Amount
26
159.68
8
5.16
1
11.14
16
87.80
16
41.28
1
3.97
9
17.52
1
3.38
2
4.44
1
11.47
81
345.84
Cases of misappropriation/defalcation
(Reference: Paragraph 1.10 / Page 18)
Appendix 1.6
Total
umber
Amount
5
25.51
6
11.38
8
22.45
15
82.97
15
23.28
39
262.96
12
87.40
21
34.02
43
113.79
8
5.16
36
62.70
7
31.14
18
95.81
6
53.18
4
406.32
28
103.73
45
186.21
6
74.38
10
224.01
5
11.91
30
280.44
12
114.99
10
53.08
2
4.44
1
11.47
5
64.61
397
2,447.34
(Amount : Rupees in lakh)
Appendices
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Appendix 2.1
List of test-checked villages under Zilla Panchayats selected for audit
(Reference: Paragraph 2.1.3 / Page 25)
Zilla Panchayat
Bangalore Rural
Chamarajanagar
Mandya
Bidar
Serial umber
ame of the Village test-checked
01
02
03
04
05
06
07
08
09
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
Vaagata
Thyamagondlu
Koramangala
Channarayapatana
Arisinakunte
Gangavaara Chowdappanahalli
Channahalli
Kumbalahalli
Poojena Agrahara
Koyira
Kaarahalli
Venkatagirikote
Ummathur
Yeragamballi
Bheemanabeedu
Ramapura
Kestur
Horeyala
Kelasur
Bommalapura
Doddamole
Harave
Irasawadi
Hardhanahalli
Kaagalawadi
Hebbasur
Akkihebbal
Maduvinakodi
Bandihole
Koolagere
Kyathaghatta
Belakavaadi
Holalu
Aarani
Aralakuppe
P.Hosahalli
Mangala
Bannamgaadi
Dugganahalli
Devalapura
Chikali (U)
Wadagaon (D)
Uchalambe
Gorata (B)
Tungaon (H)
Choladabaka
Malkapur
Reekulagi
Changlera
Hanakuni
Sedol
Raajola
Ladwanthi
Alagooda
Siddeshwara
Chalakapura
Beeri (B)
108
Appendices
Zilla Panchayat
Bagalkot
Kodagu
Tumkur
Shimoga
Serial umber
ame of the Village test-checked
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
Jalihal
Katageri
Gaddanakeri
Bodanayakanadinni
Siddapura
Kandagalla
Kodihala
Tungala
Aasangi
Budni PM
Belura
Nandawadagi
Ihole
Nagura
Dadanatti
Hebbala
Dhavaleshwara
Uttura
Bilkerura
Benakatti
Naawalagi
Choudlu
M. Chembu
Sampaje
Mullusoge
Thoranur
Kora
Bellavi
Kondli
Kallur
Benakanakere
Kolaala
Halevooru
Arasikere
Elanadu
Sarthahalli
Bukkapattana
Venkatapura
Chelur
Araluguppe
Kesaramadu
Honnudike
Hebbur
Mallasandra
Ripponpet (Gavatooru)
Yedehalli
Maaravalli
Chandragutti
Kesalur
109
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Appendix 2.2
Statement showing scheme-wise financial position in the test-checked
districts during the period 2003-08
(Reference: Paragraph 2.2.8.1 / Page 40)
RIDF Scheme
Series
District
Bellary
VIII
Release Expenditure
3.24
3.19
Release
2.30
IX
Expenditure
1.90
Release
0.87
X
Expenditure
0.65
(Rupees in crore)
Total
Release Expenditure
6.41
5.74
Bijapur
2.75
2.71
0.65
0.65
0.72
0.53
4.12
3.89
Chikmagalur
3.40
3.32
2.90
2.89
0.65
0.51
6.95
6.72
Gadag
4.26
4.08
2.00
1.89
0.23
0.23
6.49
6.20
Gulbarga
3.82
3.53
2.61
1.96
1.35
0.93
7.78
6.42
Hassan
3.30
3.02
6.64
4.74
0.75
0.82
10.69
8.58
Mandya
3.96
3.65
0.69
0.67
0.80
0.47
5.45
4.79
Shimoga
3.68
3.44
2.16
1.94
1.10
1.06
6.94
6.44
28.41
26.94
19.95
16.64
6.47
5.20
54.83
48.78
TOTAL
CMGSY (Head of account – 3054)
Bellary
2003-04
R
E
2.41
0.93
2004-05
R
E
3.71
3.71
2005-06
R
E
4.40
2.23
2006-07
R
E
6.53
6.39
2007-08
R
E
5.54
4.58
Bijapur
1.98
3.02
3.27
6.00
4.64
5.26
District
3.15
2.89
2.15
5.26
(Rupees in crore)
Total
R
E
22.59
17.84
19.53
18.09
Chikmagalur
3.32
1.38
2.56
2.72
3.26
2.16
5.67
5.67
6.68
6.48
21.49
18.41
Gadag
1.53
0.63
2.17
2.03
2.95
1.53
4.37
4.37
4.13
4.37
15.15
12.93
Gulbarga
3.18
2.26
6.26
5.94
12.48
9.04
10.87
7.95
15.36
15.08
48.15
40.27
Hassan
3.23
0.40
3.65
1.84
3.32
2.58
6.84
6.84
7.13
7.03
24.17
18.69
Mandya
7.72
2.48
4.62
1.56
4.28
2.30
7.56
7.03
10.45
6.60
34.63
19.97
Shimoga
3.36
1.18
4.42
3.38
5.38
0.84
14.44
14.44
6.88
7.73
34.48
27.57
TOTAL
26.73
12.41
30.41
24.07
39.34
22.83
62.28
57.33
61.43
57.13
220.19
173.77
R-Release and E-Expenditure
110
Appendices
5054 – Capital outlay on roads and bridges
(Rupees in crore)
Total
R
E
4.65
3.52
Bellary
2003-04
R
E
0.96 0.74
2004-05
R
E
0.29 0.29
2005-06
R
E
0.91 0.71
2006-07
R
E
0.92 0.92
2007-08
R
E
1.57
0.86
Bijapur
0.57
0.92
0.48
0.48
0.82
0.82
0.83
0.28
1.43
0.37
4.13
2.87
Chikmagalur
0.83
0.63
0.77
0.67
0.66
0.67
0.66
0.61
1.94
1.87
4.86
4.45
Gadag
0.35
0.22
0.25
0.25
0.58
0.51
0.59
0.59
1.01
1.01
2.78
2.58
Gulbarga
1.64
0.92
1.70
1.68
1.79
0.85
1.80
1.02
3.10
1.16
10.03
5.63
Hassan
0.47
0.15
0.20
0.20
0.91
0.78
0.92
0.92
1.91
1.91
4.41
3.96
Mandya
0.74
0.43
1.08
0.69
0.88
0.87
0.88
0.87
1.52
1.27
5.10
4.13
Shimoga
0.68
0.40
0.21
0.22
0.74
0.27
0.74
0.74
2.13
1.96
4.50
3.59
TOTAL
6.24
4.41
4.98
4.48
7.29
5.48
7.34
5.95
14.61
10.41
40.46
30.73
District
R-Release and E-Expenditure
TFC Grants
(Rupees in crore)
District
Bellary
First instalment-of
2006-07
Release
Expenditure
2.64
2.64
Second instalment of
2006-07
Release
Expenditure
2.64
1.05
Total
Release
5.28
Expenditure
3.69
Bijapur
1.96
1.96
1.96
1.77
3.92
3.73
Chikmagalur
3.42
3.01
3.42
3.42
6.84
6.43
Gadag
2.15
1.40
2.15
2.65
4.30
4.05
Gulbarga
3.26
2.79
3.26
2.48
6.52
5.27
Hassan
4.41
4.41
4.41
4.30
8.82
8.71
Mandya
6.27
2.13
6.27
6.27
12.54
8.40
Shimoga
4.57
1.80
4.57
4.57
9.14
6.37
TOTAL
28.68
20.14
28.68
26.51
57.36
46.65
111
Shimoga
Shimoga
Chikmagalur
Chikmagalur
Chikmagalur
Chennarayapatna
(Hassan district)
Chennarayapatna
(Hassan district)
Chennarayapatna
(Hassan district)
Chennarayapatna
(Hassan district)
3
4
5
6
7
8
9
10
11
13
Chennarayapatna
(Hassan district)
Chennarayapatna
(Hassan district)
Sagar (Shimoga)
2
12
Sagar (Shimoga)
1
Sl.o.
ame of
Division
Improvement to road from KarkikoppaGeejagaru in Sagar taluk
Improvement to road from Mugalagere to
Nimbegundi in Shikharipura taluk
Improvement and Asphalting to road from
Tadasa to Navile Barapura via Padmenahalli
in Bhadravathi taluk
Improvement to road from Jagatguru to
Nijavud Hiraara road
Improvements to road from HirebaihuMalleshangudda-Balehole road in Mudigere
taluk
Improvements to road from BalacholeSudeman-Kolagur Marasanise road in
Mudigere taluk
Improvements to road from 3.50 km to 7.00
km on 19.11 road and join B.S.Road in
Ramenahalli Bislehally in Kadur taluk
Improvement and asphalting Haranahally,
Nagenahaly, Kamalpura road in Arasikere
taluk
Improvement to road from Hirisare-Didaga
road to Balaganchi via Honnashettyhalli,
Kabbinagere to Gowdanahally in
Chennarayanapatna taluk
Imrovement and ashalting to road from K.R.
Pete, Mandagere road to join H.N. Pura road
Improvement and asphalting to road from
Keragodu to Kallabydarahally in
Holenarasipur taluk
Improvements to road from Sannenahally,
Mallenahally-Gollarahatti in Arasikere taluk
Improvement to road for Arasikere to
Byrambadi in Arasikere taluk
TOTAL
ame of work
Appendix 2.3
20.06
23.21
16.31
20.97
9.36
13.38
22.00
22.00
14.00
15.96
13.83
11.89
22.61
Amount
put to
tender
112
17.02.2005
14.12.2004
01.12.2003
01.12.2003
05.12.2003
12.05.2003
09.06.2003
26.09.2003
19.03.2005
10.03.2005
05.12.2003
04.08.2003
25.01.2004
Date of
Award
16.08.2005
13.06.2005
31.05.2004
31.05.2004
04.06.2004
07.02.2004
02.01.2004
01.06.2004
02.09.2005
09.08.2005
04.06.2004
03.02.2004
01.07.2004
Due date of
completion
15.03.2008
31.12.2007
22.08.2005
25.08.2006
17.11.2005
30.07.2005
19.02.2005
28.02.2005
30.05.2006
30.01.2006
05.09.2005
31.03.2006
01.03.2005
Date of
completion
Statement showing on/short levy of penalty
(Reference: Paragraph o.2.2.9.4 / Page 42)
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
940 days
927 days
441 days
816 days
521 days
537 days
414 days
273 days
271 days
172 days
455 days
790 days
239 days
Delay
0.61
1.50
-
-
-
-
-
0.32
0.14
0.05
0.01
0.04
0.04
0.01
Penalty levied
16.66
1.74
1.22
1.57
0.70
1.00
1.65
1.65
0.79
1.20
1.04
0.89
1.71
Penalty
leviable
16.05
1.50
1.74
1.22
1.57
0.70
1.00
1.33
1.51
0.74
1.19
1.00
0.85
1.70
on/Short levy
(Rupees in lakh)
Health
Assistants
Staff
nurses
Specialists
General
Doctors
Cadre
75
92
Sanctioned
Strength
50
69
Men-inposition
2003-04
92
Sanctioned
strength
25
75
Details not available
23
Vacant
49
71
Men-inposition
2004-05
113
75
54
111
Sanctioned
strength
Not furnished
26
21
Vacant
47
18
79
Men-inposition
2005-06
28
36
32
Vacant
115
54
111
Sanctioned
strength
81
16
84
Men-inposition
2006-07
34
38
27
Vacant
Statement showing sanctioned strength, men-in-position and vacancy in different cadres in
the Department of Health and Family Welfare in Bellary district
(Reference: Paragraph 2.3.9.2 / Page 61)
Appendix 2.4
644
115
58
117
Sanctioned
strength
502
91
15
82
Men-inposition
2007-08
142
24
43
35
Vacant
Appendices
22-08-2002
29-05-2006
Vanenur and five villages
Sindhuvala and four villages
TOTAL
NA - Not available
PWS - piped water supply
Uppaarahosahalli
24-01-2004
24-12-2003
PWS to AK Hal, Basarahalli
and Halamurani camp
PWS to Balakundi, Mylapura
and
28-02-2004
PWS to Devalapura and
Somalapura
ame of the village
Swajaldhara Scheme
Date of
commencement
23-10-2002
Sridhargadda and three villages
TOTAL
Date of
commencement
ame of the village
Submission Projects
Appendix 2.5
31-03-2004
23-02-2004
27-05-2004
Scheduled
date of
completion
28-5-2007
22-8-2003
23-1-2004
Scheduled
date of
completion
114
501.50
228.00
110.00
163.50
Original
estimated
cost
645.50
285.00
164.50
196.00
Original
estimated
cost
342.69
167.13
54.78
120.78
Expenditure
864.48
322.50
249.67
292.31
Expenditure
NA
NA
NA
Revised
cost
1,018.74
390.94
257.90
369.90
Revised cost
Reasons
(Rupees in lakh)
Reasons
(Rupees in lakh)
Contract rescinded due to delay in completion
and works re-tendered
Land problems
Land problems and contractors demanding
cost escalation (Revised estimates approved
by State Government during June 2008)
Statement showing the details of incomplete water supply schemes
(Reference : Paragraph 2.3.14.1 / Page 71)
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
Appendices
Appendix 2.6
Department-wise position of pendency in receipt of Action Taken otes
(Reference : Paragraph 2.15 / Page 96)
Department
Commerce and Industries
Rural Development and
Panchayat Raj
TOTAL
♣
Audit Report
(PRIs) - 2006
Audit Report
(PRIs) - 2007
Total
DPs
Reviews
DPs
Reviews
DPs
Reviews
-
-
1
-
1
-
11
3
11♣
3
22
06
11
3
12
3
23
06
Alongwith RDPR, the ATNs are outstanding from the departments of Agriculture and
Horticulture (Para No.2.13), Forest, Ecology and Environment (Para No.2.14) and
Social Welfare (Para No.2.15) also.
115
Bagalkot
Bangalore (Rural)
Bangalore (Urban)
Bellary
Bijapur
Bidar
Belgaum
Chamarajanagar
Chikmagalur
Chitradurga
Dakshina Kannada
Davanagere
Dharwad
Gadag
Gulbarga
Hassan
Haveri
Kodagu
Kolar
Koppal
Mandya
Mysore
Raichur
Shimoga
Tumkur
Udupi
Uttara Kannada
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
TOTAL
Zilla Panchayat
Sl.
o.
1,485
58
32
28
96
69
48
196
3
13
32
13
19
38
57
188
21
42
20
60
31
62
15
110
51
63
5
115
4,021
189
60
65
267
172
160
611
4
15
89
19
68
73
151
631
30
103
35
127
74
152
31
326
86
80
5
398
More than 10 years
(till 1997-98)
IRs
Paras
Appendix 2.7
1,060
32
38
45
55
39
39
84
7
14
21
13
31
62
52
94
26
26
12
49
20
49
34
52
30
61
11
64
3,419
89
88
119
168
98
181
308
16
26
64
21
100
138
151
437
56
72
35
200
67
164
103
216
79
170
15
238
5 to 10 years
(1998-2003)
IRs
Paras
503
16
26
65
13
15
13
41
5
11
11
8
12
26
26
23
18
19
1
22
12
24
16
18
12
27
2
21
116
2,123
74
59
176
96
48
107
214
21
40
42
22
46
61
117
161
45
38
5
123
76
92
77
127
59
92
3
102
3 to 5 years
(2003-2005)
IRs
Paras
3
4
7
8
6
5
13
8
7
1
3
7
15
13
7
17
8
6
16
3
12
7
5
11
14
5
13
1,330
18
19
25
38
28
44
93
36
30
1
10
26
36
62
59
69
21
40
118
34
84
86
78
80
82
40
73
Paras
2005-06
224
IRs
Pendency
332
8
31
35
9
13
1
21
14
13
9
6
13
15
4
9
7
8
5
11
7
15
20
7
9
20
12
10
IRs
2,115
91
136
152
61
83
15
149
84
58
41
17
100
59
23
117
45
32
41
73
37
145
111
69
84
159
62
71
Paras
2006-07
Inspection Reports and Paragraphs Outstanding
(Reference: Paragraph 2.16 / Page 97 )
Audit Report (Panchayat Raj Institutions) for the year ended 31 March 2008
8
30
20
9
16
4
9
18
7
11
11
19
17
7
5
1
14
10
1
5
22
21
6
19
20
5
14
329
IRs
2,123
65
135
64
88
132
45
52
131
27
45
74
121
95
45
49
3
88
75
7
22
134
168
41
147
135
39
96
Paras
2007-08
3,933
125
161
200
190
158
110
364
55
65
85
54
101
173
159
326
90
117
54
159
78
184
113
198
132
205
40
237
IRs
Total
15,131
526
497
601
718
561
552
1,427
292
196
282
163
461
462
549
1,454
248
354
231
648
310
771
576
857
535
718
164
978
Paras
Fly UP